Business Expansion

Same Day Business Loans: What Are My Options?

Last updated on November 19, 2020

Jacques Famy Jr

What are Same Day Small Business Loans: The Definition of a “Same-Day” Business Loan

According to The Cambridge Dictionary, “same-day” business funding is the term used to describe a service provided on the same day that it is ordered (i.e., same-day delivery, service, or sales). The goal is to get funding fast, not tomorrow or in a couple of days, but today. Let’s face it: you need a fast business loan. As a small business owner, you know that the unexpected is bound to happen, and when it does, sometimes you need fast, same-day financing because you can’t afford to wait.

Small business owners will be looking for same-day business loans at some point or another. A small business loan that you can apply, receive approval for, and access the money all within the same day, will at some point be required. This is not always an easy feat, as many business loan options can take days or weeks to acquire. When you need funding fast,  you must work with a business loan company with experience in business loan products that can deliver same-day results.

This guide will explore what funding options are available when small business owners need funding fast! We will break down the types of funding options available, how they are structured, the funding requirements, the best use for your situation, the benefits (pros and cons) of funding, and the best rates and terms to get funding fast.

Types of Same Day Small Business Loans in the Marketplace: What Are My Financing Options?

Short Term Business Loans

Short-term business loans are term loans that provide a lump sum of money that is repaid over terms of 6 to 18 months. When approved, you get a fixed amount and a fixed amount you have to pay back. The difference between short term loans and long term loans other than the obvious is the cost and the fact that it is a fast business loan. Short term loans come with a fixed payment auto deducted from your business bank account monthly, bi-weekly, weekly, or in some cases daily out of the business bank account. Limited paperwork is required, and credit requirements are more lenient than banks or traditional term loans. If you need cash fast, this loan option can be an excellent solution for working capital or to purchase inventory. Short term business loans are considered same day business loans.

Loan Amount: $5,000 to $500,000
Interest Rates: Starting at 4.99%
Repayment Terms: 3 months to 18 months
Payment Schedule: Weekly
Collateral: UCC Filing
Personal Guarantee: Sometimes yes, sometimes no
Paperwork: Business loan application, bank statements, sometimes financial statements
Processing Time: 1-day funding

Benefits of a Short-Term Loan:

  • Personal Credit score accepted from excellent to fair
  • Lower monthly or annual revenue requirements than those of traditional business loans
  • Fast and straightforward process with the same day funding to next day funding

Business Lines of Credit

A business line of credit works like a credit card in that it is a revolving line of credit. It allows you to draw money out and then repay at any time with you only paying principal and interest on your outstanding balance.  Credit lines do have a credit limit and are usually renewed annually but can be continuously extended depending on the lender. Both banks and alternative lenders can provide business lines of credit. The credit score of the small business owner needs to be good. This funding product is typically used to purchase Inventory, working capital, or any same day business loan requirement.

Loan Amount: $5,000 to $500,000
Interest Rates: Starting at 4.99%
Repayment Terms: 6 to 12 months
Payment Schedule: Weekly, bi-weekly, and monthly
Collateral: UCC Filing
Personal Guarantee: Required
Paperwork: Online application, bank statements, financial statements
Processing Time: 1-day funding, up to 24 hours

Benefits of a Line of Credit:

  • Ability to draw money at any time (revolving line of credit)
  • Allows borrowers to spend the money, repay it, and spend it again
  • Principal and interest rates starting at 4.99%
  • Lower costs and fees than most other funding products

Equipment Loans

Equipment is a must for many industries. The equipment and machinery needed to operate a business can be a costly expense for small business owners. Equipment loans usually come in the form of leasing or term loans. The equipment is used as collateral, and decisions are also made based on the business owner’s credit and the health of the business financials. The credit score of the business owner needs to be good or better to obtain an equipment loan.

Loan Amount: Loans starting at $10,000 up to $250,000
Interest Rates: Starting at 8.99%
Repayment Terms: 2 to 5 years
Payment Schedule: Monthly
Collateral: UCC Filing
Personal Guarantee: Required
Application Process: Online application, invoice, business bank statements, financial statements
Processing Time: Instant approval process and funding to same-day funding

Benefits of Equipment financing:

  • Simple application 1-page application
  • Limited financial paperwork
  • Repayment terms from 2 to 5 years
  • Monthly payments
  • Low annual revenue loan requirements for businesses
  • Same day funding

Merchant Cash Advance (MCA)

Merchant cash advances (also known as future receivables purchase and sale agreements) provide an upfront lump sum of money to small businesses in exchange for a fixed percentage of the businesses’ future sales. Repayment is typically made daily or weekly. With a merchant cash advance, an ACH payment auto-deducted from a business’s bank account, or the percentage is taken out of future credit card sales until the payback obligation is met. Terms are expressed as a future sale, so you are given a fixed amount and then responsible for paying back a greater amount through a fixed percentage of future sales. The difference between the amount given and the amount paid back to complete the agreement is your flat cost of money. The estimated time to repay is typically 6 to 18 months, but there are no term limits as the repayment is based on future sales. This type of business funding is not a term loan but a cash advance.

Advance Amount: $5,000 to $500,000
Factor Rates: 1.12% to 1.45%
Repayment Timeframes: Three months to 18 months but no time limit required
Payment Schedule: Daily, weekly
Collateral: UCC Filing
Personal Guarantee: None, Business Performance Guarantee
Paperwork: Application, bank statements, credit card processing statements (if applicable)
Processing Time: Same day funding to 24 hours

Benefits of Merchant Cash Advances:

  • Flexible repayment terms attached to future sales
  • Provides funds to business owners with Excellent to Sub Prime Credit
  • Payments fluctuate to future sales controlling the margin of profit

Business Credit Cards

Business credit cards work similarly to personal credit cards. They are a revolving line of credit with a credit limit with a minimum monthly payment requirement typically lower than a business loan. You are issued a plastic card with an account number that can be used online and in-person for any purchases or other funding types. You only pay interest based on the current principal. Great for cash flow needs.

Credit Limits: $500 up to $125,000
Interest Rates: Introductory interest rate at 0% up to 29%
Repayment Terms: Revolving line of credit
Payment Schedule: Monthly
Collateral: None
Personal Guarantee: Yes
Application Process: Online application, sometimes income proof
Underwriting Process: Instant funding in as little as 2 to 3 hours

Benefits of Credit Cards:

  • Can be used 24 hours a day, seven days a week
  • No limitations on the use of funds
  • Flexible monthly minimum payments
  • Principal & Interest rates

Invoice Financing

Invoice financing, also known as “invoice factoring” or “accounts receivable financing,” allows business owners to finance purchase orders or outstanding invoices. An Invoice finance company will advance a set amount of the unpaid invoice to the business owner and collect directly from the client or customer on the invoice the unpaid portion for an additional fee giving the business owner the money for that invoice in advance of the terms of the invoice. Invoice financing is not a business loan but a cash advance.

Invoice Limits: Up to 10 million
Paperwork: Online application, invoices, accounts receivable
Process: Same day funding

Benefits of Credit Cards:

  • Invoice advances on demand
  • No limitations on the use of funds
  • No Personal  Credit Score Required for application
  • Fees are only 1% to 5% of the invoice, no interest rate

Applying for Same Day Business Loans? Tips to Prepare

Check Your Credit Report and Credit Scores – First, understand your personal credit and credit score so you can communicate better with your business loan originator.
Check Your Financials – Look at your financials, business bank statements, tax returns, recent profit and loss statements, and cash flow statements to gauge your business’s financial health. Know your numbers, whether it is annual revenue (sales) or most recent monthly sales deposits in your business account.
Consider the Use of Same Day Business Loans – Clearly identify the need and the “how much” before speaking with a  funding advisor.
Compare Business Loan Qualification Requirements – Determine the loans that you are most likely to gain approval. Make sure your business funding advisor has access to all available products to meet your specific needs.
Online Application Information for Business Loans – Have all necessary information at your disposal to complete any online loan applications such as personal credit score, business FEIN (Federal Employment Identification Number), and business start date and time in business.

The 5 Most Common Reasons Why Businesses Need Same Day Business Loans

1. Cash Flow Needs

There are a lot of moving parts when operating a business. Various issues can impact the cash flow, like accounts receivable (billing and collections) and payroll. These issues can create cash flow stress that must be handled sometimes with loans or cash advance.  Not making payroll is not an option, so it’s essential to have a credit facility in place to control the ups and downs of the company and stabilize funds with working capital through a variety of loan funding options.

2. Emergencies

Emergencies are defined as “a serious, unexpected, and often dangerous situation requiring immediate action” or “arising from or needed or used in an emergency.” That covers a lot of things, right? Anything from equipment breakdowns, facility repairs, financial theft, collection issues, sudden loss in sales or receivables due to an economic event, a loss of a strategic partnership that affects revenues, and other immediate needs are all covered. These emergencies are excellent reasons to fund.

3. Software and Technology Upgrades

Technology and software are essential to many small businesses if they are to operating smoothly. Everything from customer relations management systems, collections, payroll, medical data collection, equipment integration, and financial software programs will play a vital role in the overall operation. New innovations are always omnipresent, and it’s crucial to have the credit facility available to acquire the necessary technology to keep up with best practices and efficiencies.

4. Equipment Repairs & Purchases

Equipment can play a vital role in many types of small businesses, and when equipment goes down, it needs to be repaired or replaced quickly.

5. Business Opportunity

Business owners come across opportunities sometimes that they have to act fast. Whether it’s a great deal to purchase inventory for the small business on closeout or a used piece of equipment that you can acquire dirt cheap if you act fast, same day business funding may be a must.

Pros and Cons of Same Day Business Loans

Businesses that need funding in a pinch because of an emergency, or those who have failed to secure financing from traditional banks, should consider an online same day business loan. Although applicants can qualify for multiple types of financing, they typically have shorter terms, higher rates, and offer smaller funding amounts than traditional loans.

Pros of Same Day Business Loans

  • A great emergency loan
  • Reduced minimum qualifications (fewer hoops to jump through) than those required by traditional business financing

Cons of Same Day Business Loans

  • Have higher rates and costs than traditional loans
  • Have short repayment terms
  • Offer small loan amounts

The Bottom Line About Same Day Business Loans

An owner must ask themselves some critical questions before financing. Even when you are in a hurry and need a quick fix, stop, and ask: why? What is the purpose of obtaining a same-day business loan for your small business? Why do you need financing now? Is the need for capital a short-term problem or a long-term problem? Was this a one-time emergency circumstance, or will you require working capital ongoing basis? Will the company always need a credit facility to prevent last-minute needs, or is it just the nature of your practice? What challenges does the business have in getting approved? (Credit Issues, Bank Statement cash flow issues, time in the industry, financial statement issues)

You must first consider the questions above when choosing the funding solution because the answers to those questions will lead you to different term-loan business funding products.

Process

How it Works

The Process

step 1
Tell Us About Your Business

Fill out the secure online pre-approval form or call us and have a conversation with us about your business and identify your needs.

step 2
Fill Out One Page Application

It takes only a few minutes to fill out a short one page application and provide us with minimal financial paperwork.

step 3
Get Approved in Hours

You will get an answer typically within 4 to 6 business hours.

step 4
Get Funded!(in as little as 1 day!)

Funds are wired or ACH directly into your company’s bank account the day you fund.

How to Find Same Day Business Loans

AdvancePoint Capital can assist you through questions and search quickly and painlessly without wasting time or, more importantly, money. Working with AdvancePoint Capital’s alternative lenders and extensive product line offers your small business as many choices as possible. As we always say at AdvancePoint Capital, compare, shop, and you will always save!  Get fast business funding now!

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* All loans made by either WebBank, an FDIC-insured Utah industrial bank, or Bank of the Internet Federal Bank, an FDIC-insured federally chartered thrift located in California. In connection with the loans, the Banks' underwriting conditions and terms apply.