Merchant Cash Advance Restructure to Save Future
Are you fed up with repaying merchant cash advance? Are you getting a summons for not
repaying? Restructuring your merchant cash advance is an option. We will provide you a complete
guideline to restructure merchant cash advance. So, keep reading to know more.
How Sales Of Future Receivables Happen?
A merchant cash advance is a business-to-business transaction. Since merchant cash advance
funders purchase your future sales in exchange for money, it is not a traditional loan. Other loans
calculate their rates differently, while the "factor rate" formula calculates merchant cash advance
Factor rate denotes a multiplier with the total amount that the business owner will have to pay to
merchant cash advance lender. Usually, the range is 1.0-1.15 that lenders offer. The funding
company will take a fixed percentage of the merchant's credit card sale.
On days when sales are more petite, the company will get less money. On days when no sales are
processed, the funder will get no repayment. Merchant has to pay from sale of future receivables
until to advance including factor rate is repaid.
Why Is It Important To Restructure Merchant Cash Advance?
If you default on your merchant cash advance, you can face a lawsuit and summons on your way.
No one has seen the future; if you could not afford repayments, lenders can serve you with
complaints and legal notices. You will have to respond within a specific time. Otherwise, in the
absence of response, a default judgment will be entered against you.
Once judgment is entered, now you have lost the right to defend that lawsuit. If a merchant cash
advance has defaulted, lenders can interfere or even attempt to freeze your business and personal
accounts, leading your business to a literal closure leve