no collateral required, bad credit rating accepted, easy & quick to organize
potential for high interest rates with this type of lending
check terms and conditions carefully for excessive interest rates which occur with some providers
Next Level Funding (Merchant Cash Advance) Review - What are business owners saying?
You need to borrow money or you'll go under.
What options do you have?
Well, over the last 5 years or so, the Merchant Cash Advance (MCA) industry has evolved precisely to fill this gap. The recession has resulted in numerous businesses that are ongoing concerns but unfortunately also have poor credit histories and reluctant bankers.
This is where Next Level Funding steps in.
With the ability to provide quick, unsecured loans within simple parameters, the service has its temptations.
Loans are available from 5k - 250k, approved within 24 hours and paid straight into the company bank account within 3 days. All you need is to process $2500 a month, accept Visa or Mastercard and have been in business for at least 6 months.
'We get loans approved that other lenders turn down,' they say. 'Next Level Funding have multiple options for you no matter what your credit score, financial status, or franchise.'
With banks across the world drastically cutting back on lending, an unsecured small business loan could, as Next Level Funding say, be a 'great borrowing decision'.
But the waters are getting a little muddied here.
A merchant cash advance is not, strictly speaking, a loan. Or a credit line.
'It's an investment in your business future,' say Next Level Funding. You get the money you need to grow and then repay it out of that growth.
Essentially, funds are advanced and then paid back through each credit card transaction that goes through the business. This is receivables financing available to business owners who accept credit cards as a form of payment from their customers.
The benefits are clear. Simple and straight-forward, no collateral required, no restrictions on how the money is used.
Not surprisingly, during a time when traditional banks are not providing financing to businesses, Next Level Funding has plenty of takers.
95% of qualifying applicants are approved.
'We want small business owners to realize that there are still options for them if they are in need of capital,' they say.
And it is true that the lending environment is difficult for small business owners. Even those that are prepared to use their homes as collateral may run into difficulties because of the current market.
Not surprisingly, the MCA industry is burgeoning.
And Next Level Funding appears reputable. The company meets Better Business Bureau accreditation standards, which include a commitment to resolve consumer complaints.
So, how much does it cost?
In the case of Next Level Funding, I have no idea.
There are no terms and conditions listed on their website and no example costings.
Typically, the fees charged by MCAs are around 25% of the total amount advanced but sometimes much more, up to 200% APR according the the 'Money Doctor' columnist for the American Institute of Certified Public Accountants.
An example of typical MCA costs runs like this. A $20,000 loan to a kitchen supply store cost $27,000 in credit-card sales.
'It's the only way that I've found of getting funds that I need,' said the business owner.
That's the reality of a tight credit market.
Most business owners would prefer conventional credit. But they often have no option but to take high-cost advances.
MCA providers are not regulated by state and federal agencies with regard to interest charged because they are not, technically, making loans.
However the advantage to an MCA is that the business owner is not risking their home or other collateral.
So if you are sure that you can make enough money to cover the costs, can get a contract and clear terms and conditions, then an Next Level Funding may just be able to help your business through a bad patch.
And check with other MCAs to compare terms and conditions. In fact phone and ask about terms and conditions and then post them on a forum! Small businesses may need cash advances, and they need information to help them choose from over 50 providers - this, at least, is one industry that is growing by the day.
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better business bureau listing
article on the merchant cash advance industry
article on the industry
business week article on MCAs
Reviewer has not owned or tested this product, all information contained in this review is based of research the feedback of others that may or may not have owned the product.
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