FAQ

TFG Business Associates are well-trained to assist business owners in applying to receive business funding.

The eligibility requireents for financing depend on which one you have selected and are based on a business owner’s specific credit history and creditworthiness. Generally, you need to have:

• Three months or more time in business
• Credit score of over 450, and
• Average monthly revenue of $10,000+

Specific requirements will vary.

TFG works with businesses to connect lenders with much-needed capital. Our lenders combines data science with a human touch.

Our Business Associate work directly with businesses to get the best financing for your unique needs.

• Review the available financing for business owners
• Determine which financing is right for you
• Complete the application for financing

No. TFG Lenders only perform soft credit inquiry, which does not impact your credit score.

Some funding products like Merchant Cash Advances and Invoice Factoring are less credit dependent because these financing products are based on sales instead of a credit report. Similarly, equipment financing does not have as much emphasis on credit because the equipment can be used as collateral if you default on your loan. Many of our financing solutions can help you build business credit as well.

Startups almost never qualify for traditional bank loans, and that is true for TFG’s financing as well. However, there are a lot of opinions in financing for new businesses and startups, including:

• Business credit cards
• Personal loans
• Your own savings

“Flexible” means that you can use the capital to fund whatever your business needs. Some business financing is flexible in its usage, such as a working capital loan, business expansion loan, merchant cash advance, business line of credit, or SBA loan. However, some loan and financing options are not flexible. Equipment financing can only be used to purchase or lease equipment. Any type of real estate loan will also be specific to funding a physical business location.

Before apply, you should first consider whether the capital will help your business grow or help your business survive a crisis. If you do not have a good reason for business financing, the fees and interest can really add up. However, if the business financing will help you buy new equipment, hire needed staff, or survive a crisis like the COVID-19 pandemic, then you should consider each of the following questions when reveiwing the financing option.

1. How much capital does my small business need?

2. How much is the interest rate and APR for the financing option?

3. What are the fees or prepayment penalties for it?

4. How are monthly payment amounts determined (installments, percentage remittances, etc.?)

You will typically know if you are approved for funding within hours.

If your deal closes before 3:00 PM ET, you will have the option of receiving money in your bank account the same day via wire transfer (fees may apply). Otherwise, your funds will arrive via ACH transfer the next business day.

As part of revenue-based funding, you will authorize the lender to debit your bank account directly according to the amount and frequency specified in your financing agreement.

• MCA is a flexible financial solution. Businesses can get cash quickly and don’t need to put up any collateral. This reduces the risk to the business and saves time and money when issuing collateral.
• MCA is a financial solution for businesses with a bad credit history. These businesses can get cash from the MCA even though they are not eligible for loans from banks or other financial institutions.
• MCA is a financial solution for start-ups. These businesses may be able to get cash from the MCA even though they need a credit history or sufficient revenue to meet the requirements of banks or other financial institutions.

Revenue-based financing has no interest and no true APR (Annual Percentage Rate). Each customer pays a fixed amount that does not change, regardless of how long it takes to pay in full. Calculating APR assumes a fixed payment amount and a fixed payment term. The payment relief and flexibility on payment terms that are built into our product are a big part of what makes revenue-based financing different and uniquely suited for businesses. APR does not capture the value of these benefits and instead requires assumptions that apply to loans, not revenue-based financing. For these reasons, APR cannot accurately reflect the cost of our product.

With revenue-based financing, customers receive a sum of upfront capital, in exchange for a set, agreed-upon amount of their future revenue (the money the business will bring in).

• Lender to Customer =  $ amount of upfront capital (minus a processing fee)
• Customer to Lender =  $ amount of future revenue (in weekly or daily payments)

The processing fee varies by deal, depending on the amount of upfront capital. The amount of future revenue the customer pays also varies by deal, based on the customer’s unique situation at the time of funding – financial history, industry, time in business, and more – as determined by our underwriting team. We are committed to transparency, and the customer always sees exact dollar amounts on the front page of their contract before they decide to move forward with the funding. Please note that we have simplified this language to clearly explain how revenue-based financing works. In our contract, upfront capital will be listed as “purchase price,” and future revenue will be listed as “amount sold.”