Merchant Cash Advances in Brockton, MA: How Card Sales, the Factor and the Holdback Set the Cost

Illustration only, invented figures: a Brockton, MA dry cleaner takes an advance of $14,650 at a 1.24 factor, so $18,166.00 is collected in total, with a 9% holdback on card sales. The total stays fixed in this invented case; the number of business days to finish depends on how much the shop sells.

In this invented table lower daily sales add 48 business days but no extra cost, since the total was fixed at signing. As in this page’s calculator, any part day counts as a full business day.

Illustration only, invented figures: a Plymouth County, MA tattoo studio with $940 in average daily card sales is offered $9,875 at a 1.31 factor with a 10% holdback. The steps below price it.

1. Multiply the advance by the factor: $9,875 × 1.31 = $12,936.25 collected in this invented case.
2. Subtract the advance to find the cost of the money: $3,061.25 in this invented case.
3. Divide the total by the daily collection: 10% of $940 in daily card sales is $94.00, so about 138 business days in this invented case.
4. Check the offer for any origination or other fees, which add to the cost the factor shows.

The factor works on the whole advance from the first day, unlike interest that shrinks as a balance falls. Finishing ahead of schedule leaves the total unchanged unless the contract spells out an early-completion discount.

Illustration only, invented figures: a Brockton, MA juice bar needs $12,340 for produce, cups and lids. As an advance at a 1.22 factor, $15,054.80 is collected, a cost of $2,714.80 in this invented case. As a 50-day draw on a business line of credit at 13.15% a year, the invented interest is $222.29.

The gap in this invented case is wide because the line charges only for the days the money is out, while the factor is fixed. A line, though, needs an approved limit already in place, and a funding partner may ask for more history to set one up; any line fees also count.

1. The business describes its card sales and the amount it needs, by phone or the request form.
2. A funding partner may review card processing statements and bank deposits.
3. Any offer names the advance, the factor, the holdback share and any fees.
4. After signing, the funds arrive and a share of each day’s or week’s card sales goes to the funding source until the agreed total is collected.

Some agreements adjust collections when sales fall, a step often called reconciliation; others set a fixed daily or weekly debit. The contract says which, and that detail decides what a lower-sales week means for the account.

Think of the factor as a single multiplier on the advance; the two invented offers below use 1.19 and 1.25. Illustration only, invented figures: a Plymouth County, MA car wash with $1,410 in average daily card sales compares two offers on $18,725.

In this invented comparison offer A costs $1,123.50 less but takes 75 more business days to finish, because its smaller holdback takes less from each day’s sales.

A merchant cash advance is a sale of a share of future card receipts rather than a loan, so the contract has a collected total instead of an interest rate and a term in months.

• No fixed end date: the time to finish follows card sales.
• No amortization: the factor cost does not fall as the balance does.
• Collections come from card sales or the bank account, as the contract sets.
• A personal guarantee or a lien may still be part of the agreement.

County Business Patterns counted 357 limited-service restaurants in Plymouth County, MA in 2023 (NAICS 722513). Counted by ZIP Code Business Patterns, 63 limited-service restaurants sat at ZIP 02301 addresses in 2023.

For a cost with a fixed end date, the funding types page compares installment options next to the advance.