Business Funding FAQ — Every Question Answered

T.A.G. Business Funding is a minority-owned Independent Sales Organization (ISO) founded by Carlos Torres and based in Chagrin Falls, Ohio. We connect small business owners with merchant cash advances and working capital through a network of 40+ funding partners. We are not a direct lender — we submit your application to multiple funders and present competing offers. Application is free and there is no obligation to accept any offer.

No. T.A.G. is an ISO — a broker that works with a network of MCA funders. The actual funding is provided by licensed third-party funding partners. T.A.G. earns a commission from the funder when a deal closes. This commission is paid by the funder, not deducted from your advance or charged to you.

Carlos Torres is the founder and CEO of T.A.G. Business Funding. He is a minority business owner based in northeast Ohio who founded T.A.G. to give small business owners transparent access to fast working capital. He can be reached directly at (330) 238-3003. Read his full background at funding.towersassetgroup.com/about.

No. The application is completely free. T.A.G. earns its commission from the funder only if your deal is funded — and only then. No application fee. No processing fee. No upfront cost of any kind. If you are not funded, T.A.G. earns nothing.

T.A.G. earns a commission from the funding partner when a deal is successfully closed. In states that require commercial finance broker disclosure — California, New York, Utah, Virginia, Georgia — broker compensation is disclosed in writing before funding occurs.

A direct funder shows you only their own offer. T.A.G. submits your file to 40+ funders competitively and presents all returned offers, giving you real choice and leverage on terms. Working through T.A.G. does not cost more — the ISO commission is paid by the funder. Competitive submission typically results in better factor rates and higher advance amounts than approaching a single funder directly.

A merchant cash advance (MCA) is revenue-based financing — not a loan. A funder provides a lump sum of capital upfront in exchange for a fixed amount of your future business revenue, repaid via daily or weekly debits from your business bank account. It is structured as a purchase of future receivables rather than a loan — so it is approved differently, funded faster, and evaluated on different criteria. Read the full MCA guide.

No. Legally, an MCA is a purchase of future receivables — not a loan. This distinction means it is not subject to state usury laws, does not carry an APR, and is evaluated using revenue-based underwriting rather than creditworthiness. It also means the total cost is fixed — your factor rate does not change no matter how long repayment takes.

A factor rate is the multiplier used to calculate your total repayment. Example: $50,000 advance × 1.30 factor rate = $65,000 total repayment. Factor rates typically range from 1.10 to 1.50. Unlike an interest rate, the factor rate does not compound — the total cost is fixed from day one. Use the MCA Calculator to model your exact cost. See real factor rate data by industry.

The holdback is the percentage of your daily or weekly deposits that the funder debits each period to repay the advance. Common holdback rates are 10–20% of daily deposits. On a 15% holdback with $2,000/day in deposits, you repay $300/day. The holdback rate stays constant; repayment speed varies naturally with your revenue.

APR reflects annualized interest. Factor rates reflect the total cost of the advance as a fixed multiplier — not annualized. The same factor rate produces very different effective APRs depending on repayment speed. A 1.30 factor rate over 6 months ≈ 60% APR; over 12 months ≈ 30% APR. Always evaluate both the factor rate AND the estimated repayment timeline when comparing offers.

A reconciliation clause allows you to request a holdback adjustment if your actual revenue drops significantly below the level used to calculate your payment amount. This is a consumer-protective contract term — not all funders include it. T.A.G. identifies which offers include reconciliation clauses before you sign.

A UCC-1 financing statement is a legal notice that the funder files to establish their interest in your business receivables during the advance period. It does not mean you have lost ownership of assets — it is a priority claim on future receivables. It shows up on business credit checks. The UCC-1 is released when the advance is fully repaid.

A confession of judgment (COJ) is a clause in some MCA contracts that allows a funder to obtain a court judgment against you without a trial if you default. COJs are legal in many states but banned in New York for out-of-state merchants (since 2019) and restricted elsewhere. T.A.G. discloses whether any offer contains a COJ clause. See our full contract guide at /how-to-read-an-mca-contract.

The minimum FICO score is 500. MCA approval is primarily based on monthly revenue and bank deposit history — not credit score alone. Bankruptcies, tax liens, prior bank turndowns, and low credit scores are all evaluated in context, not as automatic disqualifiers. Full qualification guide.

Most funders require a minimum of $4,000–$5,000 in average monthly deposits. Higher revenue produces larger advances and better factor rates. A business with $30,000/month qualifies for roughly $30,000–$45,000 on a first advance. See the full revenue table by advance tier.

Standard minimum: 6 months of operating history with a business bank account. Some programs accept 3-month-old businesses with strong revenue. Startups under 3 months are generally not eligible. The business must show at least 3–6 months of consistent bank statement history.

Yes. Credit scores as low as 500 are accepted. The primary approval factor is monthly business revenue — not FICO score. See the full bad credit business loans guide.

Yes. Bank declines are the most common reason business owners come to T.A.G. Banks use credit, collateral, and debt-to-income ratios. MCA funders use revenue, deposit history, and industry — different criteria. A bank decline does not affect your MCA application at all.

In many cases, yes. A federal tax lien with an active IRS payment plan is often acceptable. An active IRS bank levy on your accounts is generally disqualifying. State liens are evaluated case by case. Submit your application and the specific situation will be assessed individually.

It depends. Chapter 7 discharged more than 1 year ago: generally acceptable. Open Chapter 11 or 13: typically disqualifying. The longer ago the discharge and the stronger your recent revenue, the better your prospects.

Yes. Seasonal businesses are evaluated based on their most recent active revenue months. The holdback structure naturally slows repayment during slow periods — you repay more in busy months and less in slow months, since holdback is percentage-based.

Yes. Sole proprietors with a business bank account, a consistent deposit history, and at least 6 months of operating history are eligible. Revenue deposited to a personal account may still qualify if the business has an identifiable operating history.

Yes. Physical location is not a qualification factor. Home-based consultants, e-commerce sellers, cleaning companies, and service providers are all eligible based on their revenue — not where they operate from.

Most cash-flow businesses qualify. Eligible industries include: restaurants, contractors, construction, trucking, retail, auto repair, medical, dental, HVAC, roofing, plumbing, electrical, salons, gyms, landscaping, staffing, manufacturing, professional services, and e-commerce. Restricted: adult entertainment, firearms dealers, cannabis (most states), financial services firms. See the full industry eligibility table.

Yes. Restaurants are among the most commonly funded businesses through MCA. Both card and cash deposits count toward monthly revenue. Restaurants with $15,000+ per month and 6+ months in operation typically qualify for $15,000–$60,000. Restaurant funding guide.

Yes. General contractors, HVAC, roofing, plumbing, and electrical businesses all qualify regularly. Project-based payment patterns are understood by funders. Consistent monthly deposits (even if individual amounts vary) are the key metric. Contractor funding guide.

Yes. Owner-operators and small fleets qualify based on total monthly deposits, not load count. 6+ months of history and $8,000+ per month in deposits is a good starting point. Trucking funding guide.

Yes. Medical clinics, urgent care, dental offices, chiropractic, and physical therapy practices are MCA-eligible. Insurance reimbursement cycles create predictable cash flow. Practices with $15,000+ per month and 6+ months of history typically qualify for $20,000–$150,000.

Yes. Retail businesses — clothing boutiques, hardware stores, specialty retailers, gift shops — qualify based on total monthly deposits. Card volume and cash deposits both count. Retail funding guide.

Yes. Gyms, fitness studios, and personal training businesses are eligible. Monthly membership revenue creates consistent deposit patterns that work well for MCA underwriting. Businesses with $10,000+ per month and 6+ months of history typically qualify.

Yes. Hair salons, barbershops, nail salons, and beauty spas qualify regularly. Revenue is primarily card-based and consistent — an underwriting profile MCA funders evaluate favorably. $8,000+ per month and 6+ months in business is a good baseline. Salon funding guide.

Core requirements: (1) last 6 months of business bank statements, (2) completed one-page application. No tax returns, P&L statements, or business plans are required for the initial offer. Additional documents — voided check, driver's license — may be requested during final underwriting.

Funders use bank statements to verify monthly revenue, deposit consistency, average daily balance, and NSF frequency. Six months provides enough data to identify revenue trends — not just a single good month. Three to four months may be acceptable if revenue is strong.

The online application takes 5–10 minutes. Bank statement upload takes 2–5 minutes. Total time from start to submission: under 15 minutes in most cases. Apply here.

Most decisions return within 4–24 hours of a complete file. Morning submissions often have offers by afternoon. Complex files or higher amounts may take 24–48 hours.

Once you accept an offer and sign the contract electronically, funds deposit in 1–3 business days. Same-day funding is available on some approved files depending on funder and contract signature timing.

No. T.A.G.'s initial process uses a soft credit pull — no FICO impact. Some funders conduct a hard pull during final underwriting and will disclose this before it occurs. Hard pulls from financial applications typically affect FICO by fewer than 5 points, temporarily.

Yes. Documents are encrypted in transit. Your information is shared only with vetted funders for the purpose of evaluating your application. T.A.G. does not sell, rent, or share your data with third-party marketers.

Submit what you have. If you have 4–5 months instead of 6, some funders will still review. T.A.G. will work with you to identify what is missing and which funders may still consider your file as-is.

Repayment is via daily or weekly ACH debit from your business bank account. The holdback — typically 10–20% of average daily deposits — is debited each period. On a 15% holdback with $3,000/day in deposits, you repay $450/day. When revenue slows, the same holdback percentage produces smaller payments, extending the term automatically.

Most terms run 4–18 months. Exact duration depends on advance size, holdback rate, and revenue volume. T.A.G. provides a written repayment estimate with every offer — based on your actual deposit history — so you know the projected timeline before you sign.

Some funders offer early payoff discounts — pay off at 60% of the original term and pay only 85–95% of the remaining balance. Others require the full factor amount regardless of timing. T.A.G. discloses the early payoff policy for every offer before you sign.

Because repayment is percentage-based, slower revenue months naturally mean smaller payments — repayment extends, but total cost stays fixed. If revenue drops dramatically, contracts with reconciliation clauses allow you to request a formal payment adjustment.

Yes — this is called a 'second position.' Most funders require the current advance to be at least 50% repaid. Revenue must be sufficient to support both holdback amounts. Second positions are evaluated case by case.

Yes. Many businesses renew at 50–70% repayment. Successful repayment typically produces better renewal terms — lower factor rate and higher advance amount. T.A.G. monitors repayment progress and reaches out when renewal timing is optimal.

An active MCA with a UCC-1 lien may show up on business credit checks and could affect bank loan applications. The lien is released when the advance is repaid. MCAs generally do not appear on your personal credit report as debt.

No. Applying creates zero commitment. You review offers, ask questions, and decide whether to proceed. No deadline pressure, no penalty for declining.

T.A.G. explains reasons — to the extent funders share them. Common causes: insufficient revenue, excessive NSFs, active bankruptcy, or active IRS levy. T.A.G. will advise what to improve and when to reapply. Most declined applicants can reapply after 60–90 days of improvement.

No physical collateral. Funders secure the advance via UCC-1 lien on business receivables — not real estate or equipment. This is a key difference from traditional secured business loans.

T.A.G. earns a commission from the funder. In states with disclosure requirements (CA, NY, UT, VA, GA), broker compensation is disclosed in writing per state law. In all states, T.A.G. will disclose how it is compensated if you ask — because transparency is a core operating principle.

This depends on the funder and how far into the process you are. Before funds are deposited, contact T.A.G. immediately — it may be possible to cancel. After funds are deposited, you are in repayment and cancellation is not available. Always read the contract before signing and ask questions if anything is unclear.

Yes. Payroll is the most time-sensitive cash flow need and one of the most common MCA use cases. MCA funding reaches your account in 1–3 days — fast enough to cover payroll emergencies when no other option can.

Yes. Equipment purchases — trucks, commercial ovens, machinery, salon chairs — are common MCA uses. For equipment-specific financing with title and lower rates, T.A.G. can also explore dedicated equipment programs through its funder network.

Yes. Seasonal stock-up, bulk order discounts, and inventory build-outs are common. MCA's 1–3 day turnaround means you never miss a supplier window because capital wasn't ready.

Yes. Google Ads, social media, direct mail, SEO, and business development are all acceptable. Funders do not restrict how you deploy the capital — it is your business decision.

Yes. Equipment breakdown, slow week, unexpected large bill, invoice gap — these are exactly what MCA working capital is designed for. Speed is the advantage: 1–3 business days vs. 30–90 days for a bank loan.

Yes. Second location, new equipment line, expanded service area, additional hires, acquisition — all viable uses. For larger expansion projects, T.A.G. can also explore SBA bridge financing or equipment-specific programs depending on your profile.

SBA loans offer lower total cost (3–10% APR equivalent) but require strong credit (680+), collateral, 2+ years of history, and 60–90 day approval timelines. MCAs have higher total cost but approve in 24 hours, require no collateral, accept lower credit, and fund in 1–3 days. SBA is better if you qualify and can wait. MCA is better if you need capital fast or do not meet bank criteria. Full MCA vs. SBA comparison.

A line of credit is revolving — draw, repay, draw again up to a limit. Interest accrues only on what you draw. MCA provides a lump sum with a fixed total repayment. Lines of credit are cheaper and more flexible if you qualify, but require good credit and banking relationships. MCA is faster and easier to qualify for, with fixed total cost.

Invoice factoring advances money against specific outstanding invoices, typically for B2B businesses with net terms. MCA is based on total bank deposit revenue — card, cash, or ACH — and does not require invoice-based revenue. MCA is generally faster to fund and available to a wider range of business types than factoring.

If the equipment has long useful life and you qualify for equipment financing at 6–15% APR, equipment financing is cheaper. If you need the equipment quickly, have lower credit, or the equipment does not have strong collateral value, MCA working capital is often the faster and more accessible path. T.A.G. can help evaluate which option fits your situation.