MCA buyout
A buyout pays off an existing merchant cash advance and replaces it with one new facility, often moving you from daily debits to a weekly payment. Here is what changes, what does not, and how to tell whether it helps.
✓ Checking what you qualify for does not affect your credit score.
In a buyout, a new funder pays off the remaining balance on one or more of your existing merchant cash advances and replaces them with a single new facility. The old positions are settled and closed. What you owe now is the new facility, on the new schedule.
Where your file and your existing agreement allow it, the goal is a lower payment over a longer term, ideally weekly, so more of each week’s deposits stays in the business. It is not a way to make the balance disappear; it changes the shape and timing of what you pay.
This illustrates how spreading a payoff over a longer weekly term changes the payment. It is not an offer and it does not include new fees or a new factor rate, which would add to the new facility’s cost.
| Item | Amount | Payment |
|---|---|---|
| Advance A payoff | $24,000 | $400 a day |
| Advance B payoff | $18,000 | $300 a day |
| Combined payoff | $42,000 | $700 a day, or $3,500 a week |
| Time left at the current pace | 12 weeks ($42,000 ÷ $3,500) | |
| Spread over 26 weeks, before any new cost | About $1,615 a week | ($42,000 ÷ 26) |
The weekly payment falls by more than half, and the payoff stretches from 12 weeks to 26. That relief is real cash flow, and it is also a longer obligation. Always compare the total you will pay under the new facility with what is left on the old ones, using real payoff letters. The MCA payoff calculator and the worksheet on the MCA refinance page help.
| Buyout | Reverse consolidation | Second position | |
|---|---|---|---|
| What happens to the old advance | Paid off and closed | Stays open; new funds cover its payments | Stays open and untouched |
| New obligation | One new facility | New facility on top of the existing ones | A new position behind the first |
| Effect on daily debits | Can be replaced by a weekly payment | Reduces what you pay out of pocket per period | Adds a payment alongside the existing one |
| Best when | The existing balance is within range and cash flow is the problem | A payoff is not available but you need breathing room | You need more capital and the first position can stay |
See reverse consolidation, second position funding and existing positions and stacking.
Payoff quotes expire. Use letters that are current when you apply, and tell us about every open position so nothing surprises the file later.
They are close. A buyout pays existing advances off and closes them. A reverse consolidation leaves the existing positions in place while new funding supplies the payments. See the reverse consolidation page.
On this site, existing positions with a balance of $100,000 or less. Larger balances are reviewed case by case on the file.
Not definitely. It depends on the balance, the new term and the new cost. The goal is a lower payment over a longer term, and we review your file and your existing agreement before anything is offered.
Yes, up to the balance limit; list each payoff separately and tell us which, if any, you plan to keep open.
Say so on the application. A file that is current is easier to place, and the advance’s own agreement may set rules on default or reconciliation. See getting out of a merchant cash advance.
Same-day decision. Applying takes a few minutes and will not affect your credit score.
