PayPal Working Capital

[ill]

If you have a business that you run through PayPal, check out their new Working Capital option. They are giving out loans at fixed rates and it can help you get ahead.

Loans are maxxed out at 8% of your annual sales. For me, this meant that I could borrow $2,500 from them. I chose a 30/70 repayment option. There are no time frames on it but now they will take 30% of my future sales until the loan is repaid. To borrow 2.5k, they charged me $93 total in fees. There are no interest rates. If you choose a more loose repayment plan, like a 10/90 split, they take like $250+ in fees, but thats still only about 10% total with no compounded interest involved.

I'd recommend it to people that need some capital to start a new project.

Does anyone know other sites or lenders that have this fixed-fee kind of structure?

 

[MR. SNIFLES]

THAT'S PRETTY DECENT. I'M NOT SUPER SMART WITH THE WHOLE LENDING THING BUT IT SOUNDS BETTER THAN THE LOAN I GOT FROM THE BANK A FEW YEARS AGO.

 

[Domingo Halliburton]

this is a cash advance.

I could get you something similar if you have a business. They loan about 10-15% of your annual revenue. Unsecured. Minimum 500 credit score. It is a true business loan in the sense you can write off the interest and it helps your credit when you pay it off.

 

[ill]

this is a cash advance.

I could get you something similar if you have a business. They loan about 10-15% of your annual revenue. Unsecured. Minimum 500 credit score. It is a true business loan in the sense you can write off the interest and it helps your credit when you pay it off.

What are the rates on that? PayPal is just a flat fee with no accrued interest at all.

 

[Domingo Halliburton]

What are the rates on that? PayPal is just a flat fee with no accrued interest at all.

it works the same way. Fees, not a true APR. It can vary we have about 4 or 5 different funding partners. It's not the cheapest typically fees are in the teens.

the example we give is you borrow 10,000 you'll probably payback around $11,500.

 

[theworldismine13]

how does the option come up? i have a business account but ive never seen it come up, do you have to have a certain revenue?

 

[ill]

it works the same way. Fees, not a true APR. It can vary we have about 4 or 5 different funding partners. It's not the cheapest typically fees are in the teens.

the example we give is you borrow 10,000 you'll probably payback around $11,500.

Thats not too bad. 15% is a bit high but it might work out once I run the numbers. I'll check with my partners and PM you. What info would they need from me?

how does the option come up? i have a business account but ive never seen it come up, do you have to have a certain revenue?

I got an email about it. I did about $30k of my business through PayPal last year.

Check this link and see if your account is eligible

https://www.paypal.com/webapps/workingcapital/

 

[Domingo Halliburton]

Thats not too bad. 15% is a bit high but it might work out once I run the numbers. I'll check with my partners and PM you. What info would they need from me?

our application, our service agreement, last 6 months bank statements for the business, last 6 months credit card statements for the businesses (if applicable), voided check and a copy of your license/state ID.

We have one lender who needs the last 2 years tax returns but we have 3 or 4 other lenders we can approach without it.

 

[88m3]

@Ill if you own property look into a heloc

 

[Domingo Halliburton]

Thats not too bad. 15% is a bit high but it might work out once I run the numbers. I'll check with my partners and PM you. What info would they need from me?

Yeah it's not for everybody. It's actually meant to serve businesses that have been turned down by their bank. The advantages are it requires no collateral, they can get you the money in a couple days and it has very low credit standards.

We just only recently started doing this as we had a bunch of businesses approach us for small amounts that were too small to pay our typical retainer.

edit: like 88m3 said if you can get a loan through your bank I would try that first.

 

[ill]

Yeah it's not for everybody. It's actually meant to serve businesses that have been turned down by their bank. The advantages are it requires no collateral, they can get you the money in a couple days and it has very low credit standards.

We just only recently started doing this as we had a bunch of businesses approach us for small amounts that were too small to pay our typical retainer.

edit: like 88m3 said if you can get a loan through your bank I would try that first.

Right on. My issue is that I'm building a project in the $150k range right now so most of my money is tied up in that. I was talking to my partners about the PayPal options because we have $15k due on Red Sox tickets and it was only going to be an $800 fee to borrow from them (until I found out the max loan amount is capped) and we turn that $15 into about $25 during the year so it was a pretty small fee to not put the money up front.