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JavieCoentr

Loan/Mortgage $20K advance...

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We didn't need the money but we took it anyways as I know from past experiences that it's better to take the offer and build a relationship when you don't need it rather than coming with your mouth and hands open and getting denied when your desperate and really need it.

Terms:

  • $20,000 advance

  • 10% fee or $2,000

  • Stripe takes 5% of your daily revenue until the loan is paid back with the fee

Comparable bank loans for a $20K unsecured line would have been anywhere from 7% - %29%. We've been in business for just over 2 years so that had something to do with it I'm sure.

 

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I didn't know they did loans either, really interesting. But I am not sure you are getting that great of a deal. Your reported revenue on IH is showing $51K over the last 30 days (and seems to be trending up). So, 5% of that is $2550. At that pace you will pay off the $22000 in about 8.5 months (or quicker if the trend continues). So your 10% fee is really equivalent to about a 24% APR. (I used a credit card interest calculator to get that figure)

 

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Well, having a cash-flow is very good for any business, if you can invest it properly, resulting in more production or sales, but you should evaluate first if the outcome will be positive, because on such terms it seems like not that good of a deal. 10% fee is ok, but 5% from daily revenue can be a lot, so I'm not sure about this one. There are ways to get yourself a loan with better terms, like using services of Credit-10 SAR that provide the list of the loan companies. To be honest, I took a loan last year from a company that was listed on that site and managed to negotiate very good terms on it. It doesn't take much, all you need is to prove you financial stability and having a good credit score. In most cases, this will get you better terms than your current ones.

 

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