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How do you refinance MCA (Merchant Cash Advances)?

October 26, 2021

Advantages of Refinancing Merchant Cash Advances

Most business owners find themselves in need of working capital from time to time. Whether an unexpected event comes up, like not being paid a receivable on time, or broken equipment, its not out of the realm of possibility to end up in a bind. With MCAs being a very fast, easy way to get funded, it is appealing. However, if mismanaged issues can arise. The need to refinance MCAs may come up, and may be what lead you here in the first place. What is important, is realizing funding brokers lie all the time about “consolidating” MCA. This is a common bait to encourage an additional position, and leads to even more problems in your business.

Why is a merchant cash advance dangerous at times?

When an actionable plan to obtain a quick return on investment is in place, it is not dangerous at all really. This takes discipline from the business owner to make sure their plans are well thought out. The factor that has grown increasingly problematic is poor advice, and outright fraud. Always check reviews.

MCAs can range in time frame to payback, costs of capital, and payment structure. Overall, there are a few things in common among all types of deals:

*Short terms, typically 4-24 months

*Daily and weekly automatic payments

*Costs ranging from a 1.15 to 1.50 factor rate depending on several factors.

While getting into a tight position with overwhelming monthly outlay of payments, this does not mean there are not better options. We will cover in depth the best programs to refinance merchant cash advances, and help you understand the options you have to get back on track.



There are other options, you CAN refinance MCAs

Outside of MCA as a funding outlet, there are a plethora of other options at your disposal. Some are more difficult to obtain than others, but comparing yourself to available options is a great staring point once you feel the squeeze. We typically recommend a few main outlets to refinance an MCA, or 2, or 4.

Traditional Style Bank Term Loan

Let’s face it, when it comes to getting working capital, we all would like a multiple year term, with a monthly payment. The good news is, it actually does exist. A traditional style bank term loan will see the best rates, ranging from 8-18% APR. These all come with a monthly payment, and average term lengths of 3-5 years. Naturally, refinancing an MCA into this type of facility is going to provide a much lower monthly outlay. There is a catch, qualifications are steeper, and there is far more documentation involved. The reward is amazing terms for business lending. Here is what to expect on this process:


*2 years time in business

*650+ FICO with a solid profile

*Cash flow positive

*Provide last 2 years business tax returns, personal tax returns, 12 months bank statements, current financials, and a complete debt schedule

*Certain industries see better success than others

This refinancing option has pros and cons!

The pro of a traditional style loan is the RATE. As we all know, you can not get an MCA at this type of interest rate. Refinancing an MCA into this structure will save thousands of dollars, and allow your cash flow to recover. This program is best suited for very clean credit and financial profile borrowers, who have a bit of time to give. This program takes some time, and typically can fund in a couple of weeks. Learn more of the advantages of a term loan.

Non-Traditional Style Term Loan

When looking to refinance your MCAs, there is typically a pretty big reality in place. You need out, and you need out fast. We talk to business owners every single day requesting help, and this is the common theme. Also, let’s not gloss over the fact there are some requirements on a traditional bank loan that a lot of people will miss the mark on. An MCA can fund down to 500 credit, has no bearing on financials (unless its a large amount north of say $150,000), and is approved overall very loosely. The good news is, there is a program. This type of loan has the same multiple years, the same monthly payment structure, and like any other real loan, you only pay interest on the time you have the money. This will drastically drop your monthly outlay of payments in most cases, and can be taken care of in a single day. The program allows a FULL REFINANCE with no requirements to take cash on top. We have seen savings north of $15,000 a month, and have helped 100s of business owners with it. Here is what to expect here:


*6 months in business

*575+ credit score for best results, but can go lower

*Average daily balances that do not exceed the payment amount of the loan (we can help you ballpark this easily)

*No defaults on MCA. Any defaults will be picked up, and these types of options are honestly too late

*No industry restrictions, everyone is on the same playing field

*Must be within the 29 states the program is eligible, we will advise you on the consultation

*Have your current MCA payoff letters in hand


This refinancing option has pros and cons too!

The pro of this is the nearly immediate solution you will have if approved. The process is very straight forward, underwriting is simple, and generally this is about as smooth sailing as some MCA programs. The program needs to be used right, however. This is not a long term funding solution, however it gives you the flexibility of one. Refinancing an MCA still should not be a multiple year plan, for the best results we advise people to pay this program within 12 months or less. While you gain the flexibility of a minimum monthly payment, the goal in this type of refinance is to pay the balance down to avoid extra interest. Rates are higher in exchange for the easy process, however unlike an MCA, this is not a fixed cost, you ultimately are in control of your payback. To learn more about the non traditional MCA refinance route, check out our consolidation program.

Additional options to refinance your merchant cash advances
  • Bank or Credit Union Loan
  • Friends & Family
  • Sell Equity
  • Utilize SBA programs
  • Invoice and Account Receivable Credit Facilities


Paying off your MCAs can be a FRESH start

No matter what funding route you go to refinance and consolidate, the reward is a fresh start. It is critical however, to not fall down the same road again. Unfortunately, we have seen it several times. You as the business owner must express discipline, work towards better funding vehicles, such as a bank or even alternative line of credit, and stay away from the shady folks. One thing I love, is helping to teach business owners the best ways to avoid issues, how to spot trouble from a distance, and help them learn how to get into a better long term position. Our team takes a lot of pride (we really do, you should hear us sometimes), in helping people navigate an utterly confusing industry, and stay on a strong path forward! There is hope, we all make mistakes, but thee who never gives up is the one who makes it to the top!

Reach out to us, this is our favorite thing to do, and we would be totally pleased to give you a full assessment of where you stand, and exactly what your options are. Schedule a time to talk with us.


You CAN refinance MCAs!

As long as you meet the qualifications of traditional or non traditional, there is hope. The only ones we can not help

  • Have balances exceeding $350,000
  • Have defaults on MCA funders
  • Have very damaged bank statements (NSF, negative days)
  • Anyone who does not reach out to at least explore options
Jon Strong is the founder and managing member of Strong Capital Funding LLC.

Jon began his journey to help business owners in 2016. He spent years understanding what short-comings business owners faced, and their issues in dealing with finance brokers. Strong Capital Funding has helped fund millions of dollars to businesses, through strategic relationships and understanding.