Honest comparison of features, costs, and best use cases. Updated 2026.
| Factor | Merchant Cash Advance | Term Business Loan |
|---|---|---|
| Funding Type | Purchase of future receivables | Loan with fixed terms |
| Repayment | Daily % of card sales | Fixed monthly payment |
| Cost Format | Factor rate (1.10-1.49) | APR (8-30%) |
| Speed | 4hr decision, 1 day funding | Days to weeks |
| Best For | Strong card sales, fast cash | Known need, lower cost |
| Min Credit | 500+ FICO | 650+ FICO typical |
| Effective APR | 30-100% | 8-30% |
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