Unsecured Loans For Small Business Use Merchant Cash Advance
First-time small business owners usually are chary of unsecured start up loans. This is because the time frame for making a profit is not definite whether or not there is a properly thought out and lucrative merchant cash advance business plan in place for the future business.
When profits or revenues do not materialize per plans, as in most cases, there is danger of default on merchant cash advance loan repayment. When this happens credit rating of the person involved gets degraded as unsecured loans are granted on the basis of credit and borrowing history of the merchant cash advance business owner.
And if there is bad credit history behind, he/she can very well forget that small business merchant cash advance loan. Let's discuss some more aspects of unsecured loans.
If the credit history of 'to be' small merchant cash advance business owner is good, unsecured start-up business loans are easier to avail as compared to other business loans. But it is better to go for secured Merchant Cash Advance loans against property or equipment affiliated with the business.
Secured loan not only keeps personal credit rating intact but poses lesser risks for the merchant cash advance business owners, because they can use the hypothecated equipment to generate a merchant cash advance profit for the business. As a result the loan can be paid back on time. Not just that, secured loans are for longer tenure and come with lesser interest rate burden, thereby lowering the cost of merchant cash advance loan.
But if you have decided to apply for unsecured small business start-up loans, you should be careful about the requested amount. Remember, the more you owe on the merchant cash advance loan (including interest), the more will be the money which you have to repay.
If you are not exactly sure how well the merchant cash advance business will do in the first year and want to keep your credit rating good, it is best to request a small merchant cash advance amount for your unsecured start-up business loan. This will make sure that repayment merchant cash advance installments are small and if you are punctual in repaying, you can always ask for more, which will be gladly given.
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Posted on: August 9, 2011 02:44 AM