Sean Murray: Today's episode is about whether or not the
contract in your hands is a merchant cash advance. The most
challenging part about merchant cash advance agreements is that
the term itself is more of a colloquial term, not really a
legal one. So it's very possible what you have in your hands is a
merchant cash advance even though that word does not appear
anywhere on it. The underlying nature of a merchant cash
advance is something called the purchase of future receivables.
If you're very lucky, the title at the top of the agreement will
actually say merchant cash advance agreement. But if it
doesn't, here's the list of other terms that might appear at
the top.
The title of the agreement itself is almost besides the
point. You wouldn't sign for a mortgage just because it said
mortgage at the top right? So what you need to do in any case,
no matter what it says, is read the fine print and even the bold
print. Read through the contract. One thing to note is
that if your agreement says loan agreement at the top or the
word loan anywhere throughout the contract, it's very possible
that what you have in your hands is not actually a merchant cash
advance, it might actually be a loan. It's important to note the
difference because the defining characteristic of merchant cash
advances is that they are not loans. Thanks for watching. I'm
not a lawyer, consult an attorney iff you have any
questions about any contracts you have, thank you