If your business is juggling multiple loans, MCAs, or credit lines with different payment schedules and rates, debt consolidation can simplify your finances, reduce your total cost, and free up cash flow. This guide explains your options for consolidating business debt.
Business debt consolidation means taking out a single loan to pay off multiple existing debts. Instead of making several payments at different rates and schedules, you make one payment — ideally at a lower rate or with better terms than your current obligations.
Consolidation is worth exploring when you have multiple MCA positions or loans with daily payments straining cash flow, your total cost of borrowing is high due to multiple factor rates, you want to simplify accounting with a single monthly payment, your credit or revenue has improved since you originally borrowed, or you want to extend your repayment timeline to lower monthly costs.
SBA Loan Refinance — If you qualify, an SBA 7(a) loan can be used to refinance existing business debt at rates of 6.5-13% APR, dramatically reducing costs compared to MCAs or short-term loans.
Business Term Loan — A single term loan from an alternative lender can consolidate multiple debts into one fixed payment over 1-5 years.
Business Line of Credit — Use a line of credit to pay off higher-cost debts, then repay the LOC at a lower rate with flexible terms.
MCA Consolidation — Specialized MCA consolidation products combine multiple advances into one with a potentially lower factor rate and single daily payment.
Through Lending Valley’s marketplace, you can compare consolidation options from multiple lenders to find the best terms. Our funding specialists can analyze your current debt structure and recommend the most cost-effective consolidation strategy.
