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a few days
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Past credit issues may
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Fast Approvals
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What is a Revenue Based Business Loan?
A revenue-based business loan is an loan that your business receives in full upfront, and agrees to pay it back based on a percentage of your future monthly revenue. These payments continue until the principle + interest are repaid in full.
Funding Amount
$10K – $5M
Funding Term
3 months – 10 years
Rates
Starting at 9%
Speed
1-3 Business days
Pros
- Get access to funds quickly
- Approval process is easy
- Less than perfect credit accepted
- Use for a variety of business purposes
Cons
- Higher rates & fees than with traditional loans
- Might require collateral
- Gets more expensive with lower credit
Here’s a situation that might sound familiar: You know that you need a business loan, but a business term loan isn’t what you want or need. For one thing, you don’t have the credit score or the collateral that the banks would require for an SBA loan or another type of term loan. While you plan to use your small business loan to increase revenue, that increase isn’t going to happen overnight. The banks won’t care, though. They’ll want you to start paying back your loan before it even has time to make a difference. You need a long-term investment, not a short-term fix, and big investments take time to generate results. If your bank demands fixed payments right away, how can your business loan do you any good?
A merchant cash advance would give you the flexibility that you need, but there’s just one problem with that possibility: You don’t make most of your revenue from credit and debit card sales. Thankfully, there is an option that can work for you: the revenue-based business loan, otherwise known as a business cash advance. Read on to find out how it works.
Compared to other loan types
| Loan types | Max Amounts | Rates | Speed |
|---|---|---|---|
| Merchant Cash Advance | $7.5k – $1m | Starting at 1.09 | 1-2 business days |
| SBA Loan | $50k-$10m | Starting at 5% | 3-5 weeks |
| Business Term Loan | $10k to $5m | Starting at 5% | 1-3 business days |
| Business Line of Credit | $10k to $250k | Starting at 8% | 1-3 business days |
| Receivables/Invoice Factoring | $50k-$10m | Starting at 5.8% | 1-2 weeks |
| Equipment Financing | Up to $5m per piece | Starting at 5% | 3-10 business days |
| Revenue Based Business Loans | $10K – $5m | Starting at 9% | 1-3 business days |
United Capital Source Can Help You Get Revenue Based Financing
Ready to start our partnership? Have any more questions? Feel free to call us, email us, or start a live chat at any time. We know that the revenue-based business loan is a new thing in the business world. That’s why we’re here to answer any questions you may have about it. Ready to start your application? You can apply online with United Capital Source today. We’re ready to help, and we’re so excited to work with you.
Who Qualifies
Who Qualifies for a Revenue Based Business Loan?
To apply for any small business loan with United Capital Source, you should be able to provide three months’ worth of business bank statements. However, a revenue-based loan has a few more requirements than many other business loans. Your approval will be based on your revenue. Therefore, you should be able to prove that you have a steady baseline revenue and that your revenue will likely increase over the next few months. Do you have a cyclical revenue rather than a steadily-growing one? Then you should probably pursue other options. Don’t worry, though. Check out working capital loans instead, or give us a call. We can help you find the type of business loan that will work best for you.
How to Apply
How to Apply for Revenue Based Business Loans
So, how do you apply for a revenue-based business loan? It’s just like applying for any other type of alternative business loan, but at United Capital Source, we strive to make the application as easy and straightforward as possible.
Consider Your Needs
First, think about your funding needs. How much funding do you need, and what will you use that funding for? This step is more important for revenue-based financing than it is for other business loan types. Remember that a revenue-based business loan is meant to grow your revenue, so think about how your loan can accomplish that purpose.
Gather Your Documentation
To apply for a revenue-based business loan, you’ll need the following documents:
- Driver’s license
- Voided business check
- Bank statements
- United Capital Source 1 Page Application
Submit Your Application
Next, all you have to do is fill out your application. One of our experts will call you to go over your options and figure out the best way forward. After that, you can finalize your application. You’ll hear about your approval within 24 hours. If approved, you may receive your money in just a few business days.
How it Works
How Does Revenue Based Financing Work?
So, how exactly does a revenue-based business loan work? After you submit a successful application, you’ll receive a lump sum based on your revenue. After that, your lender receives your payments on a daily basis. Just like with a merchant cash advance, your payments will be based on your revenue, not a fixed amount. Unlike a merchant cash advance, however, your payments are based on your total revenue, not just your credit and debit card sales. We’ll provide a closer look at the payment process in the next section.
Cost
How Much Does a Revenue Based Business Loan Cost?
Your financing cost will likely start at around 9% for a revenue based business loan. Now, what about your regular payments? How much will you spend on those? Like we said, payments are collected daily, and the amount collected will depend on your revenue for that day. Percentages are sometimes negotiable, but they’re usually under 10%. This idea is to avoid interrupting your cash flow.
People Also Ask
People Also Ask
People have lots of questions about the revenue-based business loan. If you ever have any questions, please feel free to call us and ask. Meanwhile, here are the most common questions that we receive about the revenue-based business loan option.
How Can I Use the Funds from a Revenue-Based Business Loan?
Just like with a business term loan, you can use your revenue based business loan on just about any business purpose. However, the idea is to increase your revenue. Think of it as making an investment into your business’s future. Therefore, the most appropriate uses will help you build your business over time. Some possible uses include a major marketing campaign, product development, and hiring more salespeople.
How Much Does My Credit Score Matter?
Not much. Low credit scores do not significantly harm your chances of getting approved for a revenue based business loan. At United Capital Source, we’re more concerned about how much revenue your business makes and how much your financing will help you keep building that revenue.
Why Haven’t I Heard of This Option Before?
While business term loans have been around forever, revenue-based business loans are relatively new. That’s because banks still cling to the idea of credit scores above everything else. Meanwhile, alternative business lenders have developed ways for people without excellent credit to get the funding that they need. The revenue based business loan is just one of those options. At United Capital Source, we’re very happy to offer this new and exciting business loan option. We always strive to find ways to help business owners reach their fullest potential.
Most customers who were approved had
Annual Revenue
$120K+
Credit Score
525+
Time in Business
4 months+
What Documents Will I Need To
Apply For Revenue Based Business Loans?
- Driver’s license
- Voided business check
- Bank statements
- United Capital Source 1 Page Application
Revenue based business loans are great for those who need funds quickly and with as little hassle as possible. Just a few bank statements & a one page application can get funds in your bank account within a few business days.
Danielle Rivelli
Revenue Based Business Loans