Can I Consolidate Business Credit Cards or Loans Along With My MCAs?
Sometimes. Consolidation is built mainly for merchant cash advances, but some funders will include a business credit card balance or a short term loan in the payoff if the combined payment makes sense for your deposits.
What does an MCA consolidation usually cover?
An MCA consolidation replaces several advances with one, paying off the existing balances and giving you a single payment, usually over a longer term. Funders focus on advances because those are the payments squeezing daily cash flow the hardest.
When do cards or loans get included?
- A business credit card with a high balance and a high rate.
- A short term loan with daily or weekly payments.
- An online loan that behaves much like an advance.
Funders look at whether paying these off improves your cash flow enough to justify the larger consolidation. They also want the payoffs sent directly to the creditors at funding.
What debt usually stays out?
Long term loans with low payments, like an SBA loan, mortgage or equipment loan, usually stay as they are. Paying them off with a shorter, higher cost product rarely makes sense. Personal debts generally stay out too.
Is consolidation always cheaper?
Consolidating a credit card into an advance can mean trading a revolving balance for a fixed cost. If the card had a low promotional rate, you'd pay more. If it was at a high rate and eating your cash every month, the trade sometimes helps. Run the numbers on each debt separately before lumping them together.
What should you have ready?
A statement for each debt you want included, showing the current balance and payment. Payoff letters for each advance. Your recent bank statements, so the funder can see the whole payment load.
How does consolidation fit the bigger picture?
Consolidation works best when the underlying business is healthy but the payments stacked up faster than sales. If the business is losing money, a bigger single payment doesn't solve that.
How does Afterfirst approach a mixed consolidation?
We'll look at each debt and tell you which ones make sense to include and which ones to leave alone.
What about personal cards used for the business?
Many owners put business costs on personal cards. Funders generally don't pay those off in a business consolidation, since the debt belongs to you, not the business. If personal cards are a big part of the burden, talk to your accountant about the best order for tackling them, and keep future business spending on a business card so the line stays clear.
Why does one payment and one plan matter?
The real value of consolidating is a single payment you can plan around. If you include other debts, make sure you close or stop using the accounts you pay off, so the balances don't quietly come back.
How can Afterfirst help with this?
Call 877-FUND-654 and list every business payment you're carrying. We'll show you what a consolidation looks like with and without the extra debts, so you can see whether including them actually helps.
What else do owners ask about this?
- Can I consolidate my MCAs if I'm already behind on payments?
- How long does an MCA consolidation take?
- Why is my MCA renewal check smaller than the approval amount?
More short answers on this topic are on the renewals and consolidation FAQ, and the MCA renewal calculator runs the numbers for your own file.
Have a question we didn't answer?
Ask us on the call. Call 877-FUND-654 with any question. We call you back, usually the same business day, and we always talk with you before we shop your file.