Daily MCA payment = (advance amount × factor rate) ÷ number of business days in the term. Example: $50,000 × 1.29 = $64,500 total repayment ÷ 126 business days (approximately 6 months) = $511.90 per business day. Most MCA payments pull automatically from your business checking account on each business day. Weekend and holiday payment rules vary by funder; confirm before signing.
Contractor Tool
Estimate your advance amount, daily payment, and total cost before applying. Designed for contractors with project-based, draw-schedule deposit patterns.
Contractor Funding Center
Daily payment is 21.0% of deposits, high risk during project gaps. Consider a smaller advance or longer term.
Contractor timing tip: Apply when your last 6 consecutive months of deposits are consistent. If any of those months had under $10,000 in deposits due to a project gap, attach a brief letter of explanation. It can be the difference between approval and decline.
Estimates only. Actual terms determined by underwriting. Read the Contractor Funding Guide for full approval factor detail.
T.A.G. Business Funding
500 FICO minimum. Bank declines OK. Revenue matters more than credit score. The funding provider sets the actual decision timeline after reviewing a complete file.
500 FICO minimum · $4K-$6K+/month revenue · Funding timing is set by the funding provider after review
How do I calculate daily MCA payments as a contractor?
Daily MCA payment = (advance amount × factor rate) ÷ number of business days in the term. Example: $50,000 × 1.29 = $64,500 total repayment ÷ 126 business days (approximately 6 months) = $511.90 per business day. Most MCA payments pull automatically from your business checking account on each business day. Weekend and holiday payment rules vary by funder; confirm before signing.
How does factor rate convert to APR for contractors?
Factor rate to APR conversion depends on term length. A 1.29 factor rate on a 6-month term converts to approximately 90% effective APR (IRR method). On a 4-month term, the same 1.29 converts to approximately 130% APR. This is why comparing factor rates between offers with different term lengths is misleading; always compare total repayment amounts and daily payment amounts side by side.
What happens to my MCA if a client does not pay and my revenue drops?
MCA payments continue pulling daily regardless of whether your clients pay you. This is the critical difference from invoice factoring. If revenue drops significantly, contact your funder immediately. Some offer payment modifications or restructuring for performing accounts in temporary distress. Most funders are not equipped to handle extended non-payment and the account will go to collections if daily pulls consistently fail.
