Small business building used as collateral for a loan

Collateral Backed Business Advances

We are now offering small business owners business cash advances that are backed by collateral.

A traditional business cash advance is solely based on the future projected receivables of a business and is unsecured, meaning there is limited recourse if an advance is not satisfied by a borrower. Cast Capital is actively introducing this new product to business owners who are traditionally accustomed to the common unsecured advance product. Using collateral to secure the loan (primarily commercial or residential real estate) allows lenders to assume lower risk when advancing funds. We have seen businesses who need to consolidate cash advances and also want additional working capital¬Ě, says Cast Capital Corp. President Bruce Leybel, a cash advance product backed by property collateral gives us the ability to offer an advance up to 3 times the monthly gross income, which is more than can be offered in an unsecured scenario.

This collateral backed model gives business owners access to more capital, which can be used to buyout multiple advances at once. Usually if a business owner has multiple advances, lenders won’t be able to clear out these advances and consolidate because there is not enough extra gross revenue to lend against. Therefore, a collateral backed product can provide a higher payout, allowing for the consolidation of multiple advances. Consolidation of advances is advantageous for borrows, as the daily or weekly paybacks can be lowered and the payback term extended.