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  • Digg it UP - Business Cash Advance Strategies - Ten Problems to Avoid With Credit Card Receivables

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    sing costs (Preferred/Recommended: No closing costs)
  • Financial Statements required (Preferred/Recommended: Financial statements not required)
  • Collateral required (Preferred/Recommended: Collateral not required)
  • Fixed term to pay off the business cash advance (Preferred/Recommended: No fixed term for repayment)
  • Fixed payments to pay off the business cash advance (Preferred/Recommended: No fixed payments)
  • High credit scores (680 to 700 or higher) required to qualify (Preferred/Reco
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    Even thriving small businesses frequently need more cash than they can borrow from a bank. One of the least-known commercial financing strategies for small businesses is potentially the best strategy to quickly obtain needed cash for growing their business. This commercial financing strategy uses an under-utilized business asset (credit card receivables) to obtain business cash advances based upon a merchant's sales volume. These business cash advances typically vary from $5,000 to $300,000. Small businesses will frequently benefit from converting future cash flow into immediate working capital. The most likely candidates to benefit from this strategy are restaurants, bars, service businesses and retail stores.

    This strategy is also known as "credit card factoring". Many small businesses have relied upon a commercial financing strategy called "receivables factoring" which allows them to sell their future receivables at a discount. Most small businesses cannot adequately document their receivables in order to qualify for this kind of commercial financing. Many other small businesses (such as restaurants, bars, service businesses and retail stores noted above) simply do not have such receivables to rely upon as a commercial financing tool.

    What these businesses do have in many cases is documented sales volume and documented credit card sales activity. It is this documented level of sales volume and credit card sales activity that becomes a financial asset to the business. Business cash advances up to $300,000 can be obtained based on a merchant's sales volume and future credit card sales.

    Before employing this strategy, small businesses should realize that there are several recurring potential problems that they need to anticipate. Ten common problems that small business owners should avoid when employing this strategy are highlighted below. Preferred/Recommended business cash advance requirements are shown in parentheses after each potential problem.

    1. Up-front fees (Preferred/Recommended: No up-front fees)
    2. Closing costs (Preferred/Recommended: No closing costs)
    3. Financial Statements required (Preferred/Recommended: Financial statements not required)
    4. Collateral required (Preferred/Recommended: Collateral not required)
    5. Fixed term to pay off the business cash advance (Preferred/Recommended: No fixed term for repayment)
    6. Fixed payments to pay off the business cash advance (Preferred/Recommended: No fixed payments)
    7. High credit scores (680 to 700 or higher) required to qualify (Preferred/Recom
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      ently benefit from converting future cash flow into immediate working capital. The most likely candidates to benefit from this strategy are restaurants, bars, service businesses and retail stores.

      This strategy is also known as "credit card factoring". Many small businesses have relied upon a commercial financing strategy called "receivables factoring" which allows them to sell their future receivables at a discount. Most small businesses cannot adequately document their receivables in order to qualify for this kind of commercial financing. Many other small businesses (such as restaurants, bars, service businesses and retail stores noted above) simply do not have such receivables to rely upon as a commercial financing tool.

      What these businesses do have in many cases is documented sales volume and documented credit card sales activity. It is this documented level of sales volume and credit card sales activity that becomes a financial asset to the business. Business cash advances up to $300,000 can be obtained based on a merchant's sales volume and future credit card sales.

      Before employing this strategy, small businesses should realize that there are several recurring potential problems that they need to anticipate. Ten common problems that small business owners should avoid when employing this strategy are highlighted below. Preferred/Recommended business cash advance requirements are shown in parentheses after each potential problem.

      1. Up-front fees (Preferred/Recommended: No up-front fees)
      2. Closing costs (Preferred/Recommended: No closing costs)
      3. Financial Statements required (Preferred/Recommended: Financial statements not required)
      4. Collateral required (Preferred/Recommended: Collateral not required)
      5. Fixed term to pay off the business cash advance (Preferred/Recommended: No fixed term for repayment)
      6. Fixed payments to pay off the business cash advance (Preferred/Recommended: No fixed payments)
      7. High credit scores (680 to 700 or higher) required to qualify (Preferred/Reco
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        this kind of commercial financing. Many other small businesses (such as restaurants, bars, service businesses and retail stores noted above) simply do not have such receivables to rely upon as a commercial financing tool.

        What these businesses do have in many cases is documented sales volume and documented credit card sales activity. It is this documented level of sales volume and credit card sales activity that becomes a financial asset to the business. Business cash advances up to $300,000 can be obtained based on a merchant's sales volume and future credit card sales.

        Before employing this strategy, small businesses should realize that there are several recurring potential problems that they need to anticipate. Ten common problems that small business owners should avoid when employing this strategy are highlighted below. Preferred/Recommended business cash advance requirements are shown in parentheses after each potential problem.

        1. Up-front fees (Preferred/Recommended: No up-front fees)
        2. Closing costs (Preferred/Recommended: No closing costs)
        3. Financial Statements required (Preferred/Recommended: Financial statements not required)
        4. Collateral required (Preferred/Recommended: Collateral not required)
        5. Fixed term to pay off the business cash advance (Preferred/Recommended: No fixed term for repayment)
        6. Fixed payments to pay off the business cash advance (Preferred/Recommended: No fixed payments)
        7. High credit scores (680 to 700 or higher) required to qualify (Preferred/Reco
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          d on a merchant's sales volume and future credit card sales.

          Before employing this strategy, small businesses should realize that there are several recurring potential problems that they need to anticipate. Ten common problems that small business owners should avoid when employing this strategy are highlighted below. Preferred/Recommended business cash advance requirements are shown in parentheses after each potential problem.

          1. Up-front fees (Preferred/Recommended: No up-front fees)
          2. Closing costs (Preferred/Recommended: No closing costs)
          3. Financial Statements required (Preferred/Recommended: Financial statements not required)
          4. Collateral required (Preferred/Recommended: Collateral not required)
          5. Fixed term to pay off the business cash advance (Preferred/Recommended: No fixed term for repayment)
          6. Fixed payments to pay off the business cash advance (Preferred/Recommended: No fixed payments)
          7. High credit scores (680 to 700 or higher) required to qualify (Preferred/Reco
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            You know it seems to me having done much business with Arab Gentlemen that if you do not BS a little they really do not respect you much, and the problem is that under US law you have to be truthful. They like to catch you in a tall tale, it makes them feel smart and then they BS back and everyone laughs and they say; “You know I like you.”It really is a cultural thing, it is not really lying it is more like creating falsehood after falsehood until e
            sing costs (Preferred/Recommended: No closing costs)
          8. Financial Statements required (Preferred/Recommended: Financial statements not required)
          9. Collateral required (Preferred/Recommended: Collateral not required)
          10. Fixed term to pay off the business cash advance (Preferred/Recommended: No fixed term for repayment)
          11. Fixed payments to pay off the business cash advance (Preferred/Recommended: No fixed payments)
          12. High credit scores (680 to 700 or higher) required to qualify (Preferred/Recommended: Credit scores of 500 or better)
          13. 2-3 years or more in business required to qualify (Preferred/Recommended: 1 year in business)
          14. 12 to 24 months of documented credit card sales of $10,000 to $25,000 or more required (Preferred/Recommended: 6 months of $4,000 or more)
          15. Maximum business cash advance of $10,000 to $50,000 (Preferred/Recommended: Maximum cash advance of $250,000 to $300,000)

          Not all of these potential problems will be relevant to each commercial borrower. Most commercial borrowers will encounter at least 2-3 of these problems if they are reviewing business cash advance programs that use credit card receivables as the basis for obtaining short term business loans. It is not necessary to accept any of these problems in order to obtain business cash advances based on future credit card sales. There are viable credit card receivables programs which avoid all of the problems described above.

          Copyright 2005-2006 AEX Commercial Financing Group, LLC. All Rights Reserved.

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