How to Escape a Merchant Cash Advance
Daily ACH debits on a $150k MCA can drain $3k a day out of the operating account. If you're invoicing B2B, you almost certainly have a cheaper option sitting in your AR aging report—you just need a funder willing to net-fund the MCA payoff at close.
Step 1: Get the payoff letter
Call the MCA funder and request a payoff good through the next Friday. Get it in writing. If you have multiple advances (stacked), get letters for all of them.
Step 2: Assemble the file
AR aging (current), most recent three months of bank statements, sample invoices with POs, top-customer list, and articles of incorporation. That's it.
Step 3: Structure the payoff
The factor calculates advance on your book. If the initial advance covers the MCA payoffs plus a working-capital pad, the deal closes and the MCA is wired off at funding. If it doesn't quite reach, we sometimes stage payoffs over 30–60 days from ongoing invoice advances.
What it costs vs. the MCA
A typical MCA at 1.35 factor rate over 8 months is roughly 65%+ effective APR. Factoring the same receivables usually lands 15–25% APR-equivalent. Every dollar of ongoing daily debit stops immediately.