It does occur to you that you don’t really need $100,000. But, there’s a very quick list of projects you would really like to get accomplished. Hey…you might as well get these things done since you’ve suddenly got access to all this cash. This is the moment when you as a Business Owner, need to stop and ask yourself two important questions:
- If this is a “business loan” why am I being required to pay off Quikstone Capital Solutions?
- How much is this “business loan” really going to cost me?
How much is this “business loan” really costing you? Let’s examine some numbers:
The amount of the “business loan” $100,000
Cost of the “business loan” at 25% $25,000
Origination fee $2,000
Amount you owe to the “bank” $127,000
Balance owed to Quikstone Capital Solutions $20,000 (Assume $5k has been paid)
Amount of funds you actually receive $80,000
Actual cost of the money $47,000
How is that possible? Well here’s how this process usually works:
You took that $20,000 merchant cash advance from Quikstone Capital Solutions and you spent that money on things you needed such as supplies or advertising. That money is gone. You invested wisely but the money is gone. The $20,000 cost you a $5,000 advance fee and that worked for you because your payments were a percentage of credit card sales. If your sales went up then you paid quickly. If your sales went down then you paid slowly. Remember, since that “business loan” uses credit card sales as collateral, you have to pay Quikstone Capital Solutions that balance at the time the “business loan” is completed, and not as a percentage of sales. The remaining balance is paid as a LUMP SUM. That advance fee which was going to be paid back to Quikstone Capital Solutions is now all due at once. Suddenly, that $100,000 business loan is $80,000 and those weekly payments which will run about $2,500 don’t sound so good. What if you have a slow week? The $2,500 will still be due and if there are insufficient funds in your account, there will be fees associated with that, in addition to what your bank charges you.
Most of us have heard the old adage “if it’s too good to be true…then it probably is.” Don’t be taken advantage of by lenders who offer you a “business loan” and pretend to be a “bank.” If the bank you have your business checking account wouldn’t loan you money, ask yourself why this “bank”, offered you $100,000? It’s most likely because they aren’t really a bank. They are a merchant cash advance company masking themselves as a bank. Yes, that offer is too good to be true. If you are paying $47,000 for a cash payment of $80,000, then you are paying approximately 58% for the use of that $80,000 in fees or whatever the “bank” is calling the cost of the money. Your project must be very profitable to make this a good deal for you. Is money that expensive the sort of funding your business needs? Take a step back and consider the costs and risks. We believe in most cases your answer will be no.
We are always available for a no obligation analysis of your options.
Quikstone Capital Solutions provides business cash advances for all the things a business needs. Call today to discuss your business plans (866) 456-5638.
