Calculator
Enter monthly revenue, costs and debt payments. See your coverage ratio now and with the new payment added.
✓ Checking what you qualify for does not affect your credit score.
At Merchant Fund Express, here is the short answer: Compute coverage before and after a new payment to see whether cash flow can carry it.
Illustrative arithmetic only. This is not an offer or a quote; real terms depend on your file and the funder.
Coverage is cash flow available for debt divided by debt payments. At 1.0x you cover payments exactly with nothing left. Above 1.25x is a common rule of thumb for comfort, and volatile businesses want more. See the glossary on debt service coverage.
Then see how it compares in the business funding calculator and read multiple advances.
An owner with $60,000 revenue, $46,000 operating costs and $4,500 existing payments has $14,000 of cash flow and 3.1x coverage. Adding a $6,000 payment drops coverage to 1.3x, which is workable but thin. At 80% of revenue it is under 1x, and she chooses a smaller amount.
Source: Merchant Fund Express.
It is a simple version of the same idea; funders read your bank activity directly. Source: Merchant Fund Express.
Rent, payroll, supplies, utilities and similar; exclude debt payments.
Reduce the amount, lengthen the term or fix margin first.
Add them to operating costs for a conservative read.
Merchant Fund Express gives a same-day decision. Applying takes a few minutes and will not affect your credit score.
