What is Cash Flow Lending?
Cash flow Lending is a type of financing where a lender provides money to a borrower based on the anticipated future Cash Flows from the business. In return, the borrower agrees to pay back the loan plus interest over time. Usually, the term of the loan is between two and five years.
The borrower’s obligation to repay the loan comes due at the end of the period, and then he/she must begin paying off their debt. If the borrower does not make sufficient payments, they may have to sell assets (such as vehicles or real estate) to raise additional funds to pay the loan off. In some cases, the lender may choose to foreclose on the property instead of collecting the outstanding debt.
In simple words
Cash flow Lending is financial service where a borrower (you) is able to borrow money from lenders (us). You then pay us back over time. If you don’t repay us, we take legal action and sell off your property to recover our funds.
Why do i need Cash Flow Lending?
You may be thinking “why would I need Cash Flow Lending when I have savings or my own business?” Well, sometimes banks won’t lend you money if you cannot show them how much income/revenue you get each month. Also, many people want to buy their first home, renovate their existing home or start a business. These types of projects can cost thousands of dollars upfront, so they often need access to fast money. Oftentimes these loans can be repaid within 6 months to 1 year.
Why use Cash Flows?
Cash flow Lending was developed to help businesses meet short-term funding requirements. A company might need capital to purchase inventory or invest in equipment. Rather than waiting for a traditional bank to approve a loan, lenders could finance these types of loans using Cash Flows.
A Cash Flow analysis involves estimating what a business’s income streams will look like over a certain number of months, and then determining how much cash each stream will generate. When those figures are combined, you get a picture of how much the business should expect to earn in the coming months. This information helps lenders determine whether or not to provide the business with credit.
How does Cash Flow Lending work?
When a business applies for a Cash Flow loan, a lender calculates the amount of cash that the company will likely generate within the next six months. The lender uses this estimate to calculate a repayment schedule. Typically, the loan lasts three to five years. At the end of the term, the borrower repays the entire principal along with any accrued interest. Then, when the loan comes due, the borrower begins making monthly payments towards the principal balance.
Advantages of Cash Flow Loans
Cash flow Lending has several advantages over other forms of financing. For example, banks tend to give out larger amounts of credit to borrowers who already have good relationships with them. By contrast, Cash Flow Lending requires no collateral; the lender simply wants to know that the business will turn a profit in the near future. Additionally, there are no prepayment penalties so a business can quickly access the cash needed without having to wait for payment over longer periods of time.
Disadvantages of Cash Flow Loans
While Cash Flow Lending has many advantages, it also carries some disadvantages. For example, if a business doesn’t perform well during its first few months, it may struggle to pay off the loan. In addition, if a business experiences financial difficulties after receiving a loan, the lender may not be able to collect the full amount owed. Finally, Cash Flow Lending is often more expensive than other types of financing.
Can I apply for Cash Flow Lending online?
Yes! You can apply for a Cash Flow loan online.
Do i need a guarantor?
No. You do not need a guarantor to apply for a Cash Flow Lending loan.
Does Cash Flow Lending offer credit checks?
No. But sometimes it completely depends up on lender. Cash Flow Lending offers 100% finance solutions without the hassle of credit checks.