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Merchant cash advance
MCA Rates & Factor Rate
Understand how MCA pricing works, what drives your factor rate, and how to evaluate whether the cost makes sense for your business. Factor rates determine your total repayment -not interest, but a fixed multiplier.
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Key Mechanics
Typical Factor Rate Range
1.20 – 1.45
Typical Cost Drivers
Credit • Revenue • Industry • Time in Business
Funding Speed
36-72 Hours
INTERACTIVE TOOL
Factor Rate Calculator
See how factor rate and holdback percentage affect your total cost and daily payments.
PRICING BREAKDOWN
Factor Rate Ranges Explained
What different factor rate bands mean for your business and what drives placement into each range.
1.10 – 1.15
Excellent Profile
Strong credit, high revenue, low-risk industry
Example on $100K Advance
Factor Rate:
1.12
Total Repay:
$112,000
Total Cost:
$12,000
1.15 – 1.20
Strong Profile
Good credit, consistent revenue, stable business
Example on $100K Advance
Factor Rate:
1.8
Total Repay:
$118,000
Total Cost:
$18,000
1.20 – 1.30
Average Profile
Moderate credit, decent revenue, standard risk
Example on $100K Advance
Factor Rate:
1.25
Total Repay:
$125,000
Total Cost:
$25,000
1.30 – 1.45
Fair Profile
Lower credit, lower revenue, higher risk
Example on $100K Advance
Factor Rate:
1.38
Total Repay:
$138,000
Total Cost:
$38,000
1.45+
Challenging Profile
Credit issues, revenue concerns, very high risk
Example on $100K Advance
Factor Rate:
1.50
Total Repay:
$150,000
Total Cost:
$50,000
RATE DRIVERS
5 Factors That Determine Your Rate
Understanding what MCA providers evaluate when setting your factor rate.
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Credit Score
Personal and business credit both matter
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While MCAs are less credit-dependent than traditional loans, your credit profile still influences pricing. Strong credit (680+) can result in factor rates below 1.20, while challenged credit (below 600) may push rates above 1.35. Lenders review both personal and business credit history, though revenue typically carries more weight.
Monthly Revenue
Higher revenue = lower rates
Monthly revenue is the most critical factor in MCA pricing. Businesses processing $100,000+ per month in card sales typically qualify for the best rates (1.10-1.20), while those under $30,000/month may see rates of 1.30 or higher. Consistent revenue patterns also improve pricing.
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Time in Business
Longevity reduces perceived risk
Established businesses (3+ years) demonstrate stability and receive preferential pricing. Newer businesses (under 1 year) are considered higher risk and face elevated factor rates. Most MCA providers require at least 6 months of operating history.
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Industry Risk
Some industries carry higher default risk
Industry classification significantly impacts factor rates. Low-risk industries (medical, professional services) receive better pricing, while high-risk sectors (restaurants, construction) face higher rates. This reflects historical default patterns by industry type.
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Advance Size & Existing Debt
Larger advances and existing obligations affect rates
Larger advance amounts may qualify for slightly better factor rates due to economies of scale. However, existing debt (other MCAs, loans) increases risk and typically raises your rate. Multiple stacked MCAs can push factor rates significantly higher.
SIDE-BY-SIDE ANALYSIS
Real Cost Comparisons
See how different factor rates impact your total cost on the same advance amount.
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Low-Cost Example
Factor Rate: 1.15
Advance
$50,000
Total Repay
$57,500
Total Cost
$7,500
Daily Payment
$750
~77 days to payoff
Average-Cost Example
Factor Rate: 1.25
Advance
$50,000
Total Repay
$62,500
Total Cost
$12,500
Daily Payment
$750
~77 days to payoff
High-Cost Example
Factor Rate: 1.40
Advance
$50,000
Total Repay
$70,000
Total Cost
$20,000
Daily Payment
$750
~77 days to payoff
OPTIMIZATION STRATEGIES
How to Negotiate Better Rates
Practical strategies to improve your factor rate and reduce your total cost.
Shop Multiple Offers
Get quotes from several MCA providers before choosing—rates, holdback percentages, and fees can vary widely. Comparing offers side-by-side helps you understand total cost and gives you leverage to negotiate better terms.
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Improve Your Profile Before Applying
If you can wait, strengthen your application by showing steady deposits, resolving credit issues, and reducing existing obligations. A cleaner cash-flow picture and fewer red flags typically lead to more options and lower overall cost.
Negotiate Holdback Rate, Not Just Factor
The factor rate matters, but the holdback percentage controls day-to-day cash flow. Optimizing the holdback can make repayment more manageable and may even improve pricing depending on the provider and structure.
Consider Timing & Seasonality
Apply when your revenue is trending up, especially if your business is seasonal. Strong recent months can improve offer quality, while applying right after a slow period may reduce your options or increase cost.
REAL SCENARIOS
Real Business Examples
See how factor rates and holdback rates play out for different business profiles.
Retail Store
Monthly Revenue:
$120,000
Credit:
Good (680 FICO)
Advance Amount
$75,000
Factor Rate
1.18
Total Repay
$88,500
Total Cost
$13,500
Holdback %
12%
Daily Payment
$480
Est. Payoff
~184 days
Restaurant
Monthly Revenue:
$85,000
Credit:
Fair (620 FICO)
Advance Amount
$40,000
Factor Rate
1.32
Total Repay
$52,800
Total Cost
$12,800
Holdback %
18%
Daily Payment
$510
Est. Payoff
~104 days
Professional Services
Monthly Revenue:
$200,000
Credit:
Excellent (740 FICO)
Advance Amount
$100,000
Factor Rate
1.12
Total Repay
$112,000
Total Cost
$12,000
Holdback %
10%
Daily Payment
$680
Est. Payoff
~168 days
Common Questions
Frequently asked questions
Get answers to the most common questions about our financing platform and process.
Clear answers before you apply. No credit impact during pre-screening.
What types of businesses qualify for financing?
We facilitate financing for businesses across all major industries and business structures. Qualification criteria vary by lender and product type, but generally include minimum revenue thresholds, time in business, and creditworthiness standards. Our advisors assess your specific situation to identify appropriate financing options.
What is the typical timeline from application to funding?
Preliminary decisions are typically delivered within 24 hours of completed application submission. Final approval and funding timelines vary by product type and lender requirements. Alternative financing products often fund within 3-7 business days, while SBA loans typically require 2-4 weeks due to government underwriting processes.
What credit profile is required for approval?
Credit requirements vary significantly by lender and product type. Traditional bank products typically require personal credit scores of 680 or higher, while alternative lending partners may approve businesses with scores as low as 600. We evaluate your complete financial profile to identify lenders aligned with your credit standing.
What fees does BestLoanUSA charge?
BestLoanUSA does not charge upfront application fees or consultation fees. Any fees associated with specific loan products are charged directly by the lending institution and are fully disclosed prior to loan acceptance. We maintain complete transparency regarding all costs throughout the process.
How do bank and non-bank lenders differ?
Traditional banks typically offer lower interest rates but maintain stricter qualification criteria and longer approval timelines. Non-bank lenders provide faster decisions with more flexible underwriting but may charge higher rates. Our platform provides access to both, allowing you to evaluate the full spectrum of available options.
What are the borrowing limits?
Available capital ranges from $10,000 to $10 million or more, depending on product type, business financial strength, and lender criteria. During the application review process, our advisors help determine appropriate loan amounts based on your stated needs and qualification parameters.
Ready to Get Started?
Access the capital your business needs
Comprehensive financing solutions backed by expert advisory guidance. One application, multiple lender options, transparent terms.
Secure & confidential
No credit impact
Advisor-led process
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