How to Apply for a Merchant Cash Advance as a Hotel Owner?

Applying for a Merchant Cash Advance (MCA) is nothing like the marathon of paperwork one would face at a traditional bank: no tax returns, no business plans, and no waiting months for an answer. For hotel owners needing capital fast-whether it be for renovations, equipment upgrades, or seasonal preparation-the Merchant Cash Advance (MCA) application process is refreshingly straightforward.

What You'll Need to Get Started

The beauty of Merchant Cash Advance (MCA) applications is their simplicity. Most providers require only three key documents: your last three to six months of business bank statements, your credit card processing statements from the same period, and basic business identification like your EIN and business license.

That's it: no complex financial projections, or elaborate descriptions of your business model. The one thing Merchant Cash Advance (MCA) providers care most about is your credit card transaction volume. If your hotel processes credit cards regularly, and most do with room charges, restaurant bills, and event bookings, then you are halfway there.

Application Process: Easy and Fast

Most Merchant Cash Advance (MCA) applications can be completed online in less than 30 minutes. You'll provide basic information about your hotel-legal name, address, how long you've been in business-and details about yourself as the owner. The application will ask how much you need and what you'll use it for. Be specific: "renovating 12 guest rooms" or "replacing the lobby HVAC system" sounds better than vague requests.

You'll also be authorizing a credit check. While Merchant Cash Advances (MCAs) are more forgiving than banks, your credit still plays a role. Most providers can work with credit scores of 550 or above; the better your credit, the better your terms.

From Application to Approval

Things move fast once submitted. Within 24 to 48 hours, the provider will review your application and verify your bank and processing statements to make sure your card sales match what you reported and your cash flow is consistent.

The underwriting process generally takes one to three days, in which they calculate their risk and prepare an offer, comprising the advance amount, factor rate-usually 1.1 to 1.5-and holdback percentage, the portion of daily card sales they will collect for repayment.

Most hotel owners receive an offer within three to seven business days from initial application. Compare that to the 30 to 90 days that a bank loan might take.

Understanding Your Offer

When your offer arrives, read it carefully. The factor rate multiplied by your advance amount tells you the total repayment. For example, a $50,000 advance with a 1.25 factor rate means you'll pay back $62,500—a cost of $12,500.

Pay attention to the holdback percentage. If it's 15% and you process $5,000 today in cards, they'll collect $750. Be certain your hotel can handle this during high and low seasons. This is where seasonal hotels need to be most thoughtful.

Getting Funded

If you accept the offer, funding happens fast-usually within 24 to 48 hours. Sign the agreement electronically, and the money hits your business account. No closing costs, no complicated wire transfers, just straightforward deposit and you're ready to use the funds.

Repayment automatically occurs as a percent of your daily credit card sales. High-revenue days mean higher payments, and slower days mean lower payments. It adjusts naturally with the rhythm of your hotel.

Final Tips for Success

Apply with 2-3 providers to compare offers; choose one that understands the hospitality industry and seasonal fluctuations. Be honest about your needs and realistic about your capacity to repay. The entire process, from application to funding, can take as little as one week to give your hotel the capital it needs exactly when you need it.