How to Use an Asset with a Lien to Get a Business Loan

Do you want to get a business loan using assets with a lien?

 How to unlock your Assets!  Here are 3⃣ ways to use an asset that has a loan on it now as collateral for a new business loan.

Apply below:  Expert programs that include guidance getting the maximum out of your collateral.   Even if you still owe on it right now!

1. Request a lien release. 
2. Lender takes a 2nd lien position
3. Payoff the lien with proceeds. 

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3 Ways to use an asset with a loan on it as collateral for a new loan. 

1. Ask for a release of lien:

Call the existing lien holder and ask them to release the lien.    Lenders often take much more collateral than they need because they want to cover any losses on defaults.  They sometimes even take all of a business’ assets instead of only they need.  They over collateralize the loan.   Most borrowers think that is only way it will be and do not object.   The lender wins by default just by asking for more than they deserve.   

The lender may agree to release a certain piece or more of the collateral they are holding.  This works best when they have many pieces of collateral and you have already paid a lot of the loan down with timely payments. 

Push the lender hard on loans you have paid down significantly as agreed.   

Negotiation Example:  2 years ago, you took out a 4 year business loan for $100,000 and your current balance is $40,000.   The lender took 4 pieces of construction equipment worth $25,000 each and all payments have been on time. 

Telling the loan company they still have enough collateral  and maybe more than when the loan was originally closed.

The loan to value, LTV, may now be lower than when the loan closed.    In those cases, you have paid the loan loan down faster than the equipment depreciated during that time.

If they agree, follow up to verify your asset has been released at the Secretary of State, also known as the SOS.    Push hard to get a release as you may need the extra collateral, especially for a larger business loan.

2. New lender takes a second position. 

They can take a 2nd position lien on the collateral.

This works best with real estate that has a lot of equity in it.  The new loan provider can be the 2nd lien holder against the Real Estate.

Example:  A first position lender has a lien on commercial real estate.   The property is worth $500,000 and the current balance is $100,000.   The new lender makes a loan for $50,000 and then takes a 2nd lien on the property behind the 1st lien holder.   2nd and even 3rd positions are usually limited to real estate or cash flow financing.

3. New loan proceeds are used to payoff the loan

The existing loan balance on the asset is paid off.   This happens most often when the balance on the loan is very low.  As part of closing, the 1st lien is paid off and that amount is debited from the proceeds of the new loan. 

For Example:  Your business is closing a loan for $50,000 using equipment as collateral.    There is a first lien holder on the equipment and that loan has a payoff balance of $10,000.  At closing, the new lender sends a check for the payoff amount to the first lien holder and takes a 1st position on the collateral.
 

Apply Secure App. Call Tel: 919-7714177


FAQ on getting a business loan using assets with a lien .

Can I use equipment with a loan on it as collateral?

Lenders may take a 2nd position on the collateral.  In most cases, they will not make a loan if there is a lien on the asset and it is not paid off.

Do I have to payoff the loan first?

You will have to payoff the loan in many cases.   Some real estate and cash flow loans may not require a payoff of the 1st lien holder.   This will vary by lender depending on their guidelines.

Can a lender payoff the loan on my collateral?

Lenders can payoff the loan on your collateral.   The process is faster when the lender pays off the loan because they will verify and also handle the payoff. 

Can I get a loan before I have the title in hand?

Ask the lender if they are willing to close the loan and request payoff and title from the lender holding the title as part of closing.    You will have to have the title in hand if they are not willing to do that.

Conclusion

Getting a business loan using assets with a lien is possible.

Find out the lender’s requirements early in the process.   If allowed, there may be extra steps that can take a few days.   Start right away and you can close a few days sooner.

Between a release of lien, a 2nd position, or payoff, there are several creative ways you may be able to use collateral that has a loan on it right now to get a new loan.

If not, find out if other lenders have different criteria that will allow you to use encumbered collateral.    Checking into these options often lets borrowers get loans they never would have gotten otherwise.

Business Tax Extension Loan for October 15th

Do you need a business tax extension loan to pay taxes by the October 15th, 2020 deadline and haven’t come up with the funds?

Leverage the assets or cash flow of your business to pay the amount due by October 15th,  2020.   Several unique programs available, below now!

 Apply below to: Pay IRS business taxes for the October 15th, 2020 extension. 

 Multiple Programs to get approved through. 
 Flexible criteria. 
  Fast funding and closing. 

Apply Secure App. Call Tel: 919-7714177

Get a business loan to pay the IRS extension deadline of October 15th 2020

Need the money to pay the IRS October 15th deadline?  Get your business tax extension loan now!

Several relatively unknown programs available.  Due to this year’s July 15th, 2020 regular filing date, the extension period is reduced from 6 to only 3 months.   The October 15th, 2020 deadline has not been extended. 

1. Funding against the equipment your business owns. 

Businesses that have construction equipment or over the road tractor trailers can use their equipment to pay tax extensions.

You can get between 40% and 60% of the retail value of the equipment, depending on the year, make, model & condition.

Example: Your business owns a 2010 John Deer Front End Loader with a retail value of $60,000.    Based on a 40% Loan to Value, the offer would be $24,000.    The percentage will depend on the condition of the asset, maintenance records and the results of a site inspection.

A 60% valuation would give an offer of $36,000.    These ranges may vary from lender to lender.   The difference is that most lenders will not make this type of loan at all and it is also considered a specialty business loan.

Traditional banks will rarely make this type of loan.  When they do, they typically only offer approximately 10% – 20% of the value of the equipment and require real estate as part of the loan.

Therefore, if your business has to have money to pay the IRS extension amount and gets any offer close to that range, it should be strongly considered.

2. Funding against business property. 

When the IRS amount your business has to pay is high, then you may need to use business real estate.

The real estate will need to have at least 50% equity in order to have a chance to get the amount you need.    A 50% equity requirement seems like a high number.   Most lenders do not loan against 100% of the value of real estate and 65% to 85% is the maximum.

It is hard to qualify to get a loan to value higher than 70% or 75% of the appraised value.

3. Funding based on the cash flow of your business.

Another option is to fund against the cash flow of your business.  This may be the best option for businesses that are asset poor.

For Example: Your business has limited assets but strong annual revenues.  You need $25,000 to pay by October 15th,  and business annual sales are $300,000.

Based on getting approximately 50% of monthly sales, $25,000 X .50 = $12,500.     An average offer will be approximately $13K.    Offers in this example could range from $10K to $30K depending upon other factors.


FAQ Business tax extension loan 

Can I get a loan to pay business taxes by October 15th ?

There are several programs your business can choose from to pay
October 15th, 2020 business taxes.    Consider programs based on your company assets or cash flow. 

What if we can’t pay the full amount of the extension?

Refer to your Accountant.   Typically,  accountants recommend filing the return, paying as much as you can and communicating with the IRS on a payment plan.  

What can we do if we don’t qualify for enough to pay for the October 15th extension?

You may qualify for more than 1 type of loan.  A 2nd type of loan may allow your business to get the extra amount needed to pay the IRS extension balance.

Conclusion

If you need a business tax extension loan to pay October 15th, 2020 quarterly taxes quickly, look at alternative solutions.

Getting a business loan approval when the use of funds is to pay business taxes is harder to get than for other reasons.   Look at less well known options mentioned above, including  based on assets and cash flow.

Leverage the strengths of your business to get as many options as you can.  The business loans you qualify for may not be the ones you prefer.   Be open to alternatives and your business has the best chance to get money to pay the IRS or State tax extension balance!

Lowering MCA Payments: Pros and Cons

Lowering MCA Payments.    Is it a good idea, or not?  Why would you not lower your cash advance payments if it will help your cash flow?

There are significant advantages, and disadvantages to lowering your daily cash advance payments.    Disadvantages can include large extra fees, difficulty getting future business loans and being declared in default.

Apply below:  For business loans  to help your business get funding without the problems after lowering payments.  Payoff options also!   

Apply Secure App. Call Tel: 919-771-4177

Get the payments down

The lender has agreed to lowering  mca payments for you.  …….But should you do it?

Pros to Lowing MCA Payments: 

1. Immediate Cash Flow Relief: 

Lowered payments will give your business the immediate relief it needs from  daily advance payments.   How much it helps will depend on how many advances you have, how much the payments are lowered, and for how long.

2. Saving Your Business

If you have stacked daily advance payments, first find out from all the advance companies if they will lower the payments, for how much and how long.  It may turn out that the savings are not enough.

Calculating this ahead of time will help you figure out if you should go forward or not.   Some advance companies may lower the payments and others will refuse.  The amount they will lower and for how long is different from one company to another, but the savings can be significant.

Example:

Acme inc has 2 daily cash advance payments.   Each payment is $200 per day.   $200 per business day times 21 business days per month = $4,200.      Two advances means $4,200 times 2 = $8,400.

Each cash advance company agrees to lower the payments in half,  to $100 per day for 21 days.   $100 per business day times 21 = $2,100 per month.   2 advances = $2,100 times 2 = $4,200.

The total savings is $8,400 – $4,200 =  $4,200 per month.  This is significant and your business may need to go this route if it makes the difference between staying in business or going out of business.

3. Avoiding Default

Lowering payments may prevent an outright default.  It will depend on what your contract says and discussions with each lender.    Many official defaults can be avoided by negotiating with the lenders and having a clear agreement that they will not designate and list your account as a default.

Cons of lowering daily payments:

1. A Derogatory Listing with Business Lenders

Lowering cash advance payments will be considered a negative to funding companies.  Your account will be flagged.   Other lenders will see that your payments were lowered and may decline future requests.

2. It can still be a Default. 

Lowering cash advance payments almost always is a default per the original contract you signed.

It is very important to negotiate a non default  into your agreement when you lower payments.  Your account may be tagged and put into a database that still lists your business as a default account.   You may not even know this happened in spite coming to an agreement with the lender. 

3. Additional fees and other charges.

Lowering payments still means that your business did not meet the terms of the original agreement.    The advance company did not get payments they originally required.

They may impose a large additional fee as part of the agreement to lower payments.    This fee is often added to the end of the contract.    Your payments are temporarily lowered but the number of payments is extended.

This may still be better than missing payments and having an outright default, but factor this possibility into your decision.   The fees can often be significant, so ask about them when negotiating.

4. Trouble getting money later.  

Lowering cash advance payments will be considered a negative to other funding companies.  Your account will be flagged.   Other lenders will see that your payments were lowered and may decline any request.

This is basically a delinquency on your record and will make future borrowing harder.   Your business  will be declined more often.    This derogatory on your record may last for years.  As a result, your business may have additional problems getting financing.

Apply Secure App. Call Tel: 919-7714177


FAQ on Lowering cash advance payments.

How can I lower my cash advance payments?

Call the merchant cash advance company and ask for your payments to be lowered.   You must provide a verifiable and critical business reason.   So make the request before you start missing payments.

Does it hurt me to lower payments?

Your account may be listed as having lowered payments in databases that can be seen by other lenders.  It can hurt future requests for business funding depending on the lender and type of financing. 

Does lowering payments mean I defaulted?

It depends on the lender, as well as the original contract  and your negotiations with them.  Read the contract first before contacting the lender.   Make sure they do not declare a default, otherwise your account may still be declared that way without you even being aware of it.

Conclusion

Lowering mca payments should only be done as one of the later stage options you choose to improve your cash flow. There are negative consequences that can be significant.

Once you choose this option, it needs to be handled  in a systematic way.  Decide which advances you need payments lowered on and make a plan to show the lender.  Explain why you need payments lowered, how much and for how long.

Prove to the lender that you will be able to resume regular payments and then keep making those regular payments.

If you have multiple advances, it is critical to take them all into consideration. Address them all at one time, rather than a scattered approach and your cash flow should be sustainable for the long term!


Declined For Missed MCA Payments? Get Money Now!

Has your business has been declined for missed mca payments?  You don’t need to settle for a denial anymore.   Other business loan options are here to get approved and funding, today!

Choose from business loans such as a loan against equipment and even large business loans you can get with missed cash advance payments.   Get started on your funding.

 Apply Below now for business funding with missed mca payments!

Application Or Call Tel: 919-771-4177

How to get a business loan with missed MCA payments:

Steps and tips on how to get a business loan after missing mca payments.

Tools needed: internet connection, computer, phone.
Supplies needed:  Time available

1. Evaluate your missed payments.

The number of payments missed is important. Missing 1, 2 or 3 payments is considered minor and should not prevent your from being approved for more  funding.

Missing more than 3 daily advance payments may trigger denials with other lenders.   Consecutive missed payments make the prospects harder.  Bringing your payments current is the best first step to get new funding.

Communicate with the lender during the process.   Regardless of the outcome, it almost always causes the lender not to take more adverse action against you when behind.  It will also make new funding much easier.

Evaluate your missed payment status

2.  Match funding options

Tip: Begin a search for other funding options. Start the search broadly with other programs that your business may qualify for.  Decide which programs are the best fit for your business.

Look at the qualifying requirements for other programs.  Eliminate those programs that your business likely could not qualify for.   Prioritize and choose programs you can get approved for instead of programs you prefer.

Match the best programs that best fit to your business.

3. Apply

Apply for the best matching program that allows for recent missed payments on other financing.  Talk to a representative before applying when possible.

Tip: Give them information on your overall profile and discuss your chances. If it is still a good fit, then apply.

4. Close approval 

Review terms and conditions of any approval offer. Close the transaction if your business can handle the payments and the funding will assist in generating future revenue.

5. Make a plan after denial. 

If the request remains a denial, then make a plan. Understand the decline reasons.  There may still be a chance to reverse the decision and get an approval.  Try this first.  Consider applying with other lenders when you cannot get approved.

Apply with other lenders.   If that still does not work, do not stop the process.
Begin working on correcting the reasons that were used for denial during the first funding request.   Whether it is credit, financials, or cash flow, try to improve this month over month until your profile meets the requirements of the previous lenders.

Make a short term plan if the denial remains in place.

FAQ: How to get a business loan with missed mca payments:

Can I get a business loan with missed mca payments?

Yes, you can get a business loan with missed mca payments.   Review the decline reasons with the lender to see if the decline can be reversed.  You can apply with other lenders that work with recent missed payments.  Finally, you can work on correcting the denial reasons to get funding.

Can I get another cash advance after missing payments?

It is possible to get another advance.  Approval depends in part on how many payments you missed, when you missed them and if they are still past due. Getting the payments current is the most important step. Staying in frequent  communication with the lender will help your chances as well.

Do missed cash advance payments show on my credit?

Missed cash advance payments do not show up on personal credit if you have not defaulted.   Default accounts may show up on personal or business credit.  Check your contract.   It may provide information on how and when the lender reports delinquencies.

Conclusion

Being declined for missed mca payments is something that can be overcome.  Your business does not have to wait several months to get funding.

With an action plan of trying to reverse the decline decision into an approval, applying with other lenders and correcting decline reasons over time, your business should be able to get comparable funding quickly.




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Business Loans: Just 1 Month Time in Business Required!

One Month Time in Business  Loans

Brand  businesses!
Business loan program available now with one month’s bank statement and just one month’s time in business!

Complete the one page application below & provide the first month’s business bank statement. This is a start up specialty bank statement loan program.

1. Only 1 Month’s bank statement required.
2. New Businesses.
3. Fast offer and closing.

Apply below:  Small business loans with expert assistance to help your business get funding with only 1 months time in business and 1 month’s bank statement.   Get funding today!

Apply – One Month Bank Statement Program for new businesses! – Call Tel: 919-771-4177

Brand New businesses: Provide the 1st months bank statement.

New Business:  Loan program

New businesses can get approved with just the most recent month’s statement and the fast 15 second application.   Renew the loan and increase the approval amount as your sales increase.

This program is excellent for
New Businesses
Businesses that expect to have big swings in revenue due to the covid-19 pandemic after they open.
Businesses that want to establish a partner relationship with a lender.

With this program, the most recent 3 months bank statements are not required.

Typical Existing Programs

Almost all current programs require the most recent three months bank statements and a month to date statement.

Why?    Underwriting wants to see how the company’s cash flow has been over the most recent months.    They take the average of those 3 months and issue an approval based on the average.

Example: A business provides statements for the last 90 days and has the following total deposits during that time.

July:  $10,000
June: $15,000
May:  $10,000
The average per month is calculated as follows:
$35,000 % 3 = $11,666 per month.   In this example, the lender can make an offer knowing that the business brings in an average of $11,666 month.

Lenders cannot calculate an average with only the numbers for the last 30 days.  If the business deposited $10,000 in July,  then the lender will make an offer based just on that 30 day total.

An offer may be slightly lower, but the business has the opportunity to get a higher renewal offer quickly.   As sales increase, the business can get a much higher renewal offer.


FAQ on business loans with only 1 months bank statement.

Can we get a loan with just 1 month’s bank statement?

Yes. You only need to provide the first month’s statement as a brand new business.  Businesses that had a strong month since the 1st of the current month can provide a month to date statement to get a higher offer.

What if our first month had low sales?

You may still be able to get a starter offer.   As your sales grow,  you will be offered higher amounts quickly.   This is a relationship product that your business can use like a Line of Credit.

Can we get approved with only a few weeks in business?

You only need 4 weeks or more in business.   If the business began the previous month, then provide information since the beginning of the new month.   This can be a MTD Month to Date statement.

Conclusion

New businesses have limited or no funding options.   This new program allows them to get capital after only 1 month.

Even better, a relationship is established with the lender.   The borrower can get more working capital sooner and for larger amounts as the relationship is developed.

Merchant Loan Closing Call: Top 4 Tips

A merchant loan closing call is often required before the lender will wire funds into your account.    They will alert you when you need to take and complete the call.

But what exactly is a merchant call?   Why is it important?    How do you pass it,  – or fail it?

Consider the top 4⃣  ways, detailed further below, to easily handle a merchant closing call.

1.  Give fully accurate information.
2.  Don’t withhold critical information.
3.  Do not volunteer information.
4.  Do not answer if you are unsure. 

Apply below:  For business loans with expert guidance to help your business get past ANY issues and get funding today!

Apply Secure App. Call Tel: 919-771-4177

How to pass a merchant loan closing call

The lender is making the borrower closing call to you.

4 Top ways to insure the merchant loan closing call is successful and the loan funds. 

1. Give fully accurate information: 

When the lender calls, always accurately answer every question.

Even for minor information, always give completely accurate answers. This also includes clarifying things.

Example #1:

The business address on the application is a mailing address rather than the physical address.    The lender confirms the business address with you.    Let the lender know the address listed on the application is not the physical address for the business.    Give them the physical address if they ask for one.

Another example is if the lender asks if you are the owner.   If there are more owners, let the lender know about each one.

Other examples can include giving updated information on the company such as product lines, website information and a full explanation of what the company does.

2. Don’t withhold critical information

If you have important information that the lender does not know, tell them or give them an update during the live merchant loan closing call.

Any information not provided to the lender before closing can backfire and cause major problems later.    Even if one of these reasons means your business loan does not close, it is better to work through the issues now.

Example # 1:

A company buyout.   You are in negotiations to sell the company and have not told the lender.    This is critical information they would definitely want to know and likely would not approve the request if they knew.

Example # 2:

You are 1 of 2 owners of the business guaranteeing the loan.   You plan on buying out the other owner after closing.   It would be advisable to tell the lender what your plans are.    The lender approved the funding based on the current owners of the business.   If the lender knew one of the guarantors will be bought out shortly after closing, they may not approve the request.

Example # 3:

The IRS or state is filing a tax lien against you personally, or your business.
If you have back taxes and the IRS or State is about to file a lien against you or your business, it is risky not to tell the lender about this.

The loan contract may say the lender needs to be made aware of any impending liens that may be filed against you.    Not disclosing this type of information could be considered a violation of the loan loan contract.

Example # 4:

Outstanding liens on assets.   The lender does a search of existing liens and may not find your listed assets as encumbered.   The lender must be told about any liens they did not find in their search.

Sometimes previous lenders may have put a blanket lien on assets and those assets are not itemized at the Secretary of State.   Such liens are sometimes called a lien on all assets, including furniture, fixtures and equipment.    This type of lien may not list a specific asset, but still includes that asset.   Tell the lender which specific pieces of equipment are encumbered.

3. Do not volunteer information

In general, do not give information that you are not being asked about.

Giving the lender information they did not ask for only has the potential of stopping the closing. You may be telling them something they did not know about and will not like.   Even if it is minor, it may be enough to cause the loan status to be put on hold and then declined.

4. Do not answer if you are unsure.

Many times we want to get tasks over with. This causes us to sometimes answer questions when we are not completely sure about our answer. Don’t do this! If you are not sure, tell the lender you will check and call them back.

Apply Secure App. Call Tel: 919-7714177


FAQ on Merchant Loan Closing Calls.

What is a merchant call?

A merchant loan call is when a lender is about to close and fund a loan.  One of the closing requirements is they call the borrower just before funding to confirm their identity and the loan request.

What do I say on a loan closing call?

Always give correct information.  Do not withhold anything critical.  Also do not volunteer any information or answer questions when you are unsure.

What if I fail a borrower closing call?

Call the lender to find out if the problem is something that can be corrected in the short term to still fund the loan.   If not,  get a full understanding of why the call was not satisfactory.

If you cannot get the decision reversed, apply with other lenders and eliminate the issues on your next approval before the closing phase.

Conclusion

Loan closing calls for business loan are a quick,  but important part of the loan closing process.

Do not take the call when you are in the middle of another task.  Try to find out when the lender will call and what the questions will be about.

Mostly, just answer the questions accurately and thoroughly. If there is a misunderstanding or the lender does not know something important, correct and update them.

The lenders want to close the loan.   They are looking for every reasonable way to close rather than decline.  If there are still issues, then discuss them with the lender.    They will give you the best plan to get past any hurdles and fund the loan.

This should result in a quick closing process and funding!

Top 4 Tips: Pass a DecisionLogic Check

You are trying to close a business loan. The lender says you have to pass a DecisionLogic check. Consider the top 4 ways further below to help you complete an account verification to get funding asap.

Pass a DecisonLogic check

First of all, what is DecisionLogic or an account verification?  DecisonLogic is a company that many lenders use to verify a bank account and it’s activity.   They review the current month to date balances, recent negative days or overdrafts, the average balance, and other factors. Apply Below now!

Application Or Call Tel: 919-771-4177

How to Pass a DecisonLogic Bank Account Check:

    • Have at least 2 to 3 times the new loan payment in your account.   
    • No negative days, NSF’s or Overdrafts in the last week and less than 5 in any of the last 3 months.
    • Recent average balances should be strong.  
    • No new loans taken out in the current month.

1. 3 Times the Loan Payment.

Your account must have a positive balance. An overdrawn will result in an immediate decline.

At the time of the check, have at least 2 to 3 times the amount of the new loan payment in your account. If you do not, you may be declined. Do not move forward with the check if your balance does not reflect at least twice the new payment.

For Example:

If the new payment is $400, then you should try to have $800 to $1,200 in the account to help insure you will pass a Decisionlogic check.  If you have less, it puts the closing at a higher risk and your recent activity will then be very closely reviewed in the decision process.

2. No Negative Days.

Your account should not have ended the day negative in the last week.  On statements, negative days usually appear towards the end of the statement.

Negative days in the last week will not automatically result in your approval being reversed and declined. One overdrawn day for a small amount and NSF will often be overlooked. If you had more than one overdrawn day, the risk of a reversal of the approval increases. You definitely want less than 5 total negative days in any of the last 3 months bank statements to close the loan.

3. Strong Average Balances

The current month’s average daily balances should be strong.  The  amount depends a lot on your overall business sales and any new debt.   For smaller businesses getting a loan less than $25,000, the average daily balance could be as low as $1,000 and still be approved.    Pay close attention to this if your business has had recent low sales.

Businesses with higher annual revenues must have higher average balances in their checking account.

Lenders look at this number to help them decide if the business will have the cash flow to handle expenses and all required payments.   Strong average balances will help you successfully pass a decisionlogic check.

4. No New Loans

Your business should not have taken out any new loans during the last 30 days. The lender will know if you took out any loans through the end of the previous month, but not the current month.

Did you take out a new loan in the current month?   Approvals will be re-evaluated when new loans are taken out in the current month.


FAQ: How to pass a DecisionLogic Check:

What is a Decisionlogic check?

The lender securely reviews the current and most recent cash flow in your business checking account. They use that information as part of their final closing items to decide if the loan will close and fund.

What can I do after failing DecisionLogic?

Talk to the lender. Try to find out as much as you can about why you did not pass the account verification review. Also ask if you can wait a few days and try DecisionLogic again. Some declines are based on low balances that day and very recent NSF’s.
Significant deposits in the next few days along with a clean account can change a decline back into an approval.

How do I pass a DecisionLogic check?

Discuss with the lender in advance what will be required for you to pass. They may not tell you but find out as much information as you can. If you are not given the criteria, tell them what your current and recent balances are and ask if that will be good enough to pass and close the loan.

Conclusion

If any lender wants to do an account verification such as Decisionlogic, ask beforehand what they are looking for and also what will be required for your request to be completed and funded.

If you fail DecisionLogic, ask if you can try it again after you make substantial deposits or overcome the obstacles that caused the verification to fail. These 2 main ways should allow you to overcome the verification hurdle and get funding!

What other ways have helped you pass a bank verification check?


Top 3 Actions: The Bank Has Called Your Loan Due

Has the bank called your loan due, immediately?  It is a very stressful scenario.

You may have received a letter or call demanding you payoff your business or personal loan.  Very few businesses can afford to do that.
Consider the top   ways further below to fix the problem, avoid defaulting and saving any collateral. 

 Apply below to: Payoff or Refinance the Loan now – before it is in default.

 Payoff the Full Balance
 Refinance and Extend the term
 Negotiate to Restructure or Settle

Apply Secure App. Call Tel: 919-7714177

Bank delinquency rates have gone up in the 1st Quarter of 2020. You can review the Federal Reserve’s Charge-Off and Delinquency Rates report on loans and leases at commercial banks below.

Quarterly financials, credit score checks and other reviews are often requested by banks.

If your overall situation has deteriorated, you may be at a high risk of a traditional financial institution such as a bank calling your loan due immediately.

Familiarize yourself with your best options beforehand.

The Bank has called your loan due

3 ways to work it out

1. Attempt to renegotiate the contract:

Call the bank and ask for extra time for you to respond to them.  When ready, ask if they will refinance the existing loan and extend the terms.   

Calculate in advance the highest payment you can afford and ask if they can extend the contact to match those payments.  Provide data and documentation to support your request. This can include recent bank statements,  a current budget such as a profit & loss statement, or tax returns.

Show your calculations for the maximum payments you can make. Call the bank, provide your supporting documentation and make your request.

Negotiation Example: Your monthly payment is $800 per month and you have 30 months left.  The remaining payments still total  $24,000.   After looking at your current and estimated future cash flow, you calculate that you can afford $500 per month.  Ask if you can extend the term of that contract from 30 months to 48 Months.   Tell them you can handle a $500 per month payment. If they will not agree, contact or apply with us for payoff or refinance options. 

2. Payoff the Loan

Paying off the loan is usually the best option.   Borrowers that have this option available sometimes do not choose to pay off the loan.

Many do not want to sacrifice their hard earned assets and liquidity to payoff a  loan that is already in default.   At that point, some borrowers would rather negotiate a settlement or protect their assets through a bankruptcy filing.

Primary real estate held as collateral will make the borrower want to avoid a default, if they can. When the borrowers home, stocks or other valuable collateral is at stake, then borrowers strongly consider a payoff using other resources. This avoids a larger loss through total forfeiture of their collateral.

3. Refinance the Loan

Paying off the existing loan is also the hardest way. A refinance can often be approved by using a longer term asset based program to refinance.  Borrowers that qualify for 24 months or longer improve their monthly cash flow up to 75% or more every month. They also may get a weekly or monthly payment.

For Example: Your business loan was originally $50,000 and has been delinquent. The current balance is $15,000 and the bank has called the loan due.  Regular payments are $1,500 per month. You have 10 payments left but cannot make the payments. It will take your business at least 3 months for sales to get close to normal, but the lender won’t give you the extra time to recover. 

If you can refinance the contract with a 24 month asset based loan, then your monthly payments are $625 per month.  You have reduced and improved your monthly cash flow by 140%.   A refinance can be very successful in this type of situation.

Warning Signs

With the nation’s top economists forecasting that the economy will contract 6% overall in 2020 including a sharp 2nd Quarter decline, bank delinquency rates have increased. The chances are higher for personal and business loans to be called by lending institutions to protect their portfolios.

Apply Secure App. Call Tel: 919-7714177


FAQ Bank called loan due.

Can the bank call my loan due?

Many banks have provisions or covenants in their contracts that allow them to call the loan anytime and for any reason. Most borrowers are not aware of this.

What should I do if I get a payoff demand letter?

Always negotiate professionally and in good faith regardless of the situation. If you end up in court this can help your case. Make a documented case for why you cannot pay. Offer to renegotiate or settle the debt if you are able to. Use any professional legal assistance available.

What can I do if the bank wont negotiate or settle?

Pay the loan off or refinance if you can. If you cannot, then get legal representation to represent you and continue to negotiate. Often the lender will make a final offer before a court case. Arbitration written into the contract may call for a different strategy.

Why won’t the bank negotiate with me?

Willingness to negotiate varies from bank to bank. Larger banks may be less willing to negotiate because it is often a very bureaucratic process. A decision to declare a default is harder to solve after a default status.

Conclusion

If the bank has not called your loan yet, take action as soon as possible. A decision to move towards a default status has already been made by the bank when your loan has been called.

Each lender has different levels of flexibility in how they will handle the process going forward. Your responses can influence their actions and final outcome.

Do not assume that your collateral will be taken and you cannot do anything about it. If the bank believes you have a viable plan to repay or reach a workable settlement, then you may be able to get them to settle or restructure the debt.

You must, however, provide a viable, realistic plan and documentation of how you can get back on track quickly. If you cannot, then planning now on how to handle a possible default status may be your best option.


Restarting daily payments: 3 ways to handle it

Is your cash advance company restarting your daily or weekly mca payments but you still cannot pay them?  Your business may need weeks, even months for sales to recover from the virus lockdown and make the payments.    Consider 3 ways to make the payments and avoid defaulting, further below.

Restarting daily payments: How to make it work

Complete the application below to:

    • Extend the terms by refinancing
    • Consolidate your advances
    • Payoff the advances

Solve restarted mca payments-Secure Docusign Or Call Tel: 919-771-4177

Is your mca cash advance company restarting your daily payments? Top 4 options if you cannot repay

1. Extend the terms and refinance the contract:

Tell your cash advance company that you need more time for your sales to recover.     Ask if they will refinance the existing mca contract and extend the terms.   Calculate in advance the highest payment you can afford and ask if they can extend the contact to match those payments.  Provide data and documentation to support your request. This can include recent bank statements and a current budget such as a profit & loss statement.  Include your specific calculations showing the maximum payments you can make. Call the advance company, provide your supporting documentation and make your request.

For example: Your regular daily payments of $100 per day for the remaining 50 days of the contract are being debited again.  The remaining payments still total  $5,000.   After looking at your current and estimated future cash flow, you calculate that you can afford $60 per day for that contract.   That equals about 83 payments.   Ask if you can extend the term of that contract from 50 days to 83 days and tell them you feel you can handle a $60 daily payment. If they will not, contact or apply with us above. We will help you get through this process.   The lender will also verify balances and what your business can afford. 

If you have more than one cash advance, then do the same calculations for the other contract(s).    First calculate the total of daily cash advance payments you can make.    Then you can figure out the maximum daily payment you can make for each contract .

2. Consolidate your advances

You can consolidate multiple advances with one loan. This helps you because the new loan will be a longer term than the advances you have now.  Most have a term at least 50%, and up to 100% longer than the current advances.  A condition written into the contract does not allow your business to take any more new debt without permission.

Consolidators take this condition seriously. Taking new loans violates the terms and puts you in default. It is then up to the lender to enforce a payoff demand of your contract.

A variation is known as a reverse consolidation. This is easier to be approved for and could improve your cash flow from cash advances by 25% to 50%.

3. Payoff the advances that have started debiting

Paying off the existing advances usually is the best way, but also the hardest way. A payoff happens by using a longer term asset based program to payoff existing advances. Borrowers that qualify for 24 months or more improve their monthly cash flow as much as 75% or more every month. They also get a weekly or monthly payment.

For Example: Your business has a cash advance originally for $50,000 that was paused. The current balance is $15,000 and the mca company is going to restart the payments. Regular payments are $550 per day. You have 27 payments left but still cannot make them. It will take your business at least another 2 to 3 months for sales to get close to normal.

With the current payments, you have about 5 weeks left in contract. If you can pay the contract off with a 24 months asset based loan, then your monthly payments are $792 per month = $37 per business day.  $37 % $550 = 7%.  You have reduced and improved your debt on the cash advance by approximately 93%.!   Your monthly outflow on this debt went from $11,500 down to $792.  


FAQ: Frequently asked Questions on restarting daily payments:

Can the cash advance company restart my daily payments even though I can prove my sales have not recovered?

They can restart your daily payments even if your sales need much longer to recover. Calculate what you can pay per day and propose a current and increasing payment to them as sales continue to increase. Provide them the documentation to support your numbers and proposal.

What can I do if the mca advance company won’t negotiate a payment I think I can handle?

Consider a consolidation of multiple advances or a refinance buyout of one of the advances. Another option is a payoff with an assed based longer term product which may be 12 to 24 months or longer and have a monthly payment.

What is the best way to get the mca advance company to work with me in taking the full payments out of my account again?

Tell them what is the most you can pay and give them reasons why. Give them data and documentation to back up what you say. This can include the most recent 3 months bank statements, a month to date statement, interim profit and loss, and balance sheet statements. Calculate and itemize your business income and expenses to prove your claim of the maximum daily payment you can make now.

Three times the daily payment: What is it? How to handle it

The lender says you need two to three times the daily payment to close a business loan such as a bank statement loan, cash advance or loan against on equipment.

What is three times the daily payment?

Your business needs three times the daily payment.  A daily payment of $150 requires $450 to be in the business account at closing.  How do you close this loan when you do not have the funds?  Our funding experts will guide you through the process.

Complete the application below or contact us.   Our hands-on representatives will get your business through this problem, avoid a decline, and get funding now.

Get Funding now with 3 times daily payment experts – Secure Docusign
Or Call us at Tel:  1-919-771-4177

Example of needing three times the daily payment to get funding

Road Runner Roofing receives a $50,000 merchant cash advance offer.  The daily payment is $200 per day.  Just before closing, the advance company does a standard bank account verification check.  One of the items reviewed is the current balance, and Road Runner roofing has $400 in the account.   The cash advance company declines the loan.  They have $200 less than the $600 the lender wants.  What should they do?Contact us now at Tel: 919-771-4177

So what else is the lender is looking for?   The lender looks at excessive recent overdrafts, low balances,  and low average balances.  Recent negative balances lasting more than a day or two are also a problem.  Take another look at these other cash flow trouble spots.  They can bring funding to a stop immediately and permanently.

Three times the daily payment: How to make sure you have it and get your deal done.

FAQ: Frequently asked Questions:

Question: What is three times the daily payment?

Answer: Three times the daily payment refers to a frequent requirement for closing an mca merchant cash advance. Take the daily payment your business has to pay and multiply it times 3. A daily payment of $250 would require a balance of $750 at closing to avoid a decline for not enough money in the business account to cover daily payments.

Question: Will we be declined for having less money in the account at closing than what is required?

Answer: Your business may still be funded, but the account balance is compared to the amount the lender wants to see. Your current and recent balances, average daily balances, overdrafts and nsf’s will also be reviewed.

Question: I don’t have the required closing amount in the business account for a cash advance now. What should I do?

Answer: Wait until you can make a deposit to meet the amount required for the mca cash advance company to fund. If that will take too long, then call the lender and tell them how much you have in your account now. Ask them if that is enough before the closing department does the account verification. Transferring money from another account is an option.

In conclusion:

You should be aware of the importance of how much money is in your business checking account while applying for a business loan.

As discussed, if your balances are too low, your business may get declined at the last minute, just before closing. Once you are declined, it is difficult to have the decline decision reversed. Make sure you know what account balances the lenders want to see!