I could use a couple extra thousand dollars right now. I have been tempted to borrow against my card transaction revenue as collateral so to speak. I receive solicitation calls from companies that will loan me up to a % of what my credit card transactions are. They in return take automatically a % of every transaction to repay loan. Does anyone have any experience with this?
Sounds terribly risky. You might check more honorable sources. We just found out our city offers some loan options and some grant options for small businesses. This allows you to team up with your city not a legalized loan shark. The Small Business Administration may offer similar ways to assist you. The bank that you have you accounts at would be another place I'd check before one of those folks calling you. Remember if they offering to loan you money against money you have not taken in... they are wanting you to "count your chickens before they hatch".
If you have ever waited and watched for an incubator full of eggs to hatch you will know that sometimes you get a batch of cute little chicks and sometimes you get a lot of stinky rotten eggs.
I've had a couple customers use this to purchase equipment from me over the years. It all depends on the company and the %'s. If its for equipment, look at a short term lease to buy. If it's not, I always recommend your bank as the best solution. They have a relationship with you and a reason to keep you happy :).
This is going to be simple...DO NOT DO IT! It is a recipe for disaster. These leaches who offer this type of lending are not doing it because they like you and visit your shop so they want to see you make it. They are no different than the car title lenders. Nothing but a bunch of thieves.
Denise has some good advise if you must continue to borrow. Seek out the local Chamber of Commerce as well. Sometimes you will make connections that can help you out.
Bottom line...if it is too good to be true...well you know the rest.
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