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Payoff Letter: How it can help you with Loans

Definition of a Payoff Letter.  What is a Payoff Letter?

A Payoff Letter is a letter that is often required by a Lender to prove that other loans you have are paid off and have a $0 Balance.

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Examples of reasons Payoff Letters are requested:

      • A request to show other small business loans are paid off.
      • A request to verify that a credit card is paid off
      • A Letter showing that a similar type of loan has a zero balance and is paid off.

    Many lenders may want to make sure that certain loans are paid off in order for them to be willing to approve and fund a new loan. Get a loan with out one, apply below.

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    Did you know?

    These Letters are also called “Zero Balance Letter”

    They are often referred to this way to emphasize that the Letter needs to show that the balance is Zero.

    What are Payoff Letters?

    Customers cannot always provide this letter.
    Sometimes customers are not well versed in this field.  Another reason is they also don’t like getting paperwork together and are unsure how to do it.   Customers also see it as a burden that they do not have the time or desire to deal with.

    How to Handle a Payoff Letter request:

    If a Lender asks you to provide a Zero balance letter, find out which Institution it is.
    If you have more than one loan with that institution, get the Account number to make sure you will be getting the information for the correct account.    Once you have this information, call the customer service number for that Lender.

    Tell the Representative what you need and they will transfer you to the correct department.  Most Companies have specific Departments that handle this type of request.   You will be routed to that Department and they will provide the Letter.  In most cases you will receive the Letter in 2 to 4 hours.

    If you have been asked for this type of Documentation, call us to discuss.   Explain what you are being requested to provide.   There are other Financing products that do not require this and other forms of verification.   You can apply for other Financing options and avoid having to provide this type of Documentation.

    FAQ Payoff Letter Questions

    What is a Payoff Letter?

    A payoff letter is sent by a lender showing the amount required to payoff the borrower’s loan by a certain date. It often shows how much the payoff increases each day or month when not paid by that date.

    How can a Payoff Letter help me?

    It proves the total amount you owe to a lender. Without it, a new lender has to guess or estimate how much you owe. Lenders may offer less or decline your request without this information.

    How do I get the letter?

    Contact your existing lender and ask them to send you a payoff letter. Ask them to address it to whom it may concern and put a date through which the payoff is valid.

    What is a payoff demand letter?

    A payoff demand letter is issued by a lender that demands the borrower to payoff the transaction. It includes the total amount owed, a pay-by date, account number and payment options. It also lists next step consequences if not paid.

    What does it mean to request a payoff?

    Requesting a payoff means a borrower contacts their lender and asks how much is owed to payoff their loan and by what date. After payoff, borrowers should verify the lender shows their loan fully paid off.

    What is a Zero balance letter?

    A zero balance letter is issued by a previous lender to a borrower to show their loan has been paid off and has a zero balance. New lenders may ask for this when considering a loan.

    Learn more about other types of request for proof of Documentation such as
    Proof of income.

    Recent examples from the Web:

    Therapeutics Corporation entering into a Payoff Agreement and Letter.

Categories
Asset Based Loan

Payoff Merchant Cash Advances: Cash Flow Now!

How can you payoff a merchant cash advance?  Escape your merchant advance by:

  • Paying off the balance with a longer term refinance.
  • Terms from 6 or 9 months and all the way out to 36 months or longer.
  • Lower your payments up to 75% in many cases!
  • Get the daily cash flow relief your business desperately needs – NOW
  • No delinquencies or defaults with existing loans or advances!

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How to payoff a merchant cash advance

Payoff your merchant cash advance

Determine what your balance is.   Complete a list of your equipment assets, which includes Computer, medical, industrial equipment and machinery.

We will approve a loan to payoff your balance and payoff or reduce the number of cash advances.   We will also help you set up a 24, 36 or 48 month repayment term.   Even if you only want to term the balance off to 24 installments, this will significantly improve your company’s cash position immediately.

Payoff Examples

If you took out a $25,000 merchant advance for 6 months, then you were paying around $248 per day, or $5,457 every 30 days.

By terming the financing out to 24 installments, you will reduce the payment to $1,562, which is only 28% of what you were paying. If you go out 36, you will reduce it to $1,083, or 19.8% of the original amount.   This difference will make a dramatic positive influence on your cash flow.

Most frequent Requests:
– Help me payoff my MCA.
– I need get rid of my MCA Merchant Cash Advances
Help my business get out of my cash advances.
All of these requests fall into the same MCA consolidation relief product.

Example:

Tucson belt company pays off merchant cash advance with 1 loan.

Tucson belt had 3 merchant cash advances totaling $75,000 with a total monthly payment of $15,000.   This burden was killing their cash flow.   They had 6 months left on their advances.   The three advances were combined for 1 loan for year.

The monthly payment was lowered to $7,500, thereby increasing the company’s cash by $7,500.   President Bradford Jennings told BizTucson, “This Consolidation program was an excellent and necessary way to improve the cash flow for these Advances.   It has dramatically improved our financial standing.  We will be able to increase our advertising and inventory levels.   Gross receipts are expected to increase and net income rise.  We look forward to using the increased funds for expansion.”

If you are a business owner that took out a short term cash advance and are saying any of the following things or questions below, contact us today to get instant relief.

Most callers say they need to urgently get out of a merchant advance.     Many companies tell us they can’t handle it much longer and feel trapped.

You will only need to complete a short 1 page Mini app and provide an equipment list which can be completed online.   The approval process takes 1 – 3 days.  If you are approved, the closing documents may be E-Mailed to you or completed online.   You complete them and return the completed documents via fax.   A verbal verification call is completed with you and you receive funding within 1 to 2 ays afterwards.