Deerline Advances, a small-business funding broker in Prescott, Arizona, can route merchant cash advance requests to funding partners. A merchant cash advance is not a loan: the funder buys a share of future card or bank receipts and collects it through remittances. Holdback, factor rate and reconciliation terms decide the real cost. The partner decides; the partner prices.
| What it is | Future receipts bought at a discount; no loan involved |
|---|---|
| Collected by | Remittances from card or bank receipts |
| Cost expressed as | A multiplier applied to the advance |
| Holdback | Slice of each day's receipts sent to the funder |
| Key clause | Reconciliation when receipts fall |
| Who decides | The funding partner |
The advance, defined without the jargon
In a merchant cash advance, a funder pays you a lump sum now in exchange for a larger amount of your future receivables. It is a purchase, not a loan. A merchant cash advance is not a loan, so it is not repaid on an interest schedule; the purchased amount is remitted from your receipts until it is delivered in full.
Our name says Advances because owners search for them. We broker them like everything else: a partner decides, and the agreement sets the terms.
Holdback percentage and holdback rate
The holdback is the share of each day's receipts remitted to the funder. Owners ask what a holdback percentage is and what a holdback rate is; they are the same thing under two names. A higher holdback delivers the purchased amount sooner and leaves less cash in the account each day.
Some agreements collect by a fixed daily or weekly debit instead of a true percentage. A fixed debit does not shrink on a slow day unless the reconciliation clause is used, so read which method applies.
From factor to dollars remitted
Cost is usually stated as a factor rate. The advance times the factor gives the dollars the funder collects. With made-up figures only: an advance of $10,000 at a factor of 1.3 means $13,000 is remitted. Because the term is not fixed, the cost cannot be read as an annual rate the way a loan's can, and an advance remitted quickly can carry a far higher effective cost than its factor suggests.
- Write down the total to be remitted, not just the advance.
- Estimate how many days of receipts that takes at the holdback.
- Ask what fees are deducted from the advance before it reaches you.
Three clauses that decide how an advance feels
Reconciliation is the clause that adjusts remittances when receipts fall. Ask the funder how a reconciliation request is made, how often it is allowed and which records back it up. Stacking means taking a second advance while the first is still being remitted; many agreements forbid it, and two holdbacks on the same receipts can drain an account quickly.
What counts as a default, and what follows, is set out in the agreement; ask the funder to point to that clause.
Is merchant cash advance debt?
Owners often call it MCA debt, and in the bank account it can feel the same. Legally it is structured as a sale of receivables, which is why it is described with remittance and purchase language rather than interest and repayment. How it is treated in your books is a question for your accountant.
Fees taken at funding and renewals
Some funders deduct fees from the advance before it reaches the account, so the cash received is less than the advance named in the agreement. Compare offers on cash received against total to be remitted, not on the headline advance.
Renewal offers often arrive while an advance is still being remitted. A renewal can pay off the old balance and add new money, but the remaining purchased amount from the first advance is usually built into the new total. Ask for the figures in writing before agreeing.
When an advance is worth weighing in Yavapai County, AZ
Advances are built around card and bank receipts, so they are usually weighed by businesses with steady card sales. In Yavapai County, food services and drinking places had 517 employer establishments in 2023, and retail trade had 777 (U.S. Census Bureau, County Business Patterns 2023). For a business like that, compare the advance with working capital financing before signing; a fixed schedule is often cheaper if you qualify.
For a checklist of questions to put to any funder, read the post on questions before a merchant cash advance. County data is on the Prescott, AZ page, sector notes on the industries hub, and the process page shows how a request moves.
By Deerline Advances ยท Updated
