6 Options for Refinancing MCA Debt Into a Cheaper Loan

An SBA loan is the cheapest money you can get as a small business. We're talking 6–13% APR, fixed terms, monthly payments. Compare that to what you're paying on your MCA — which, when you annualize it, is probably somewhere between 40% and 350% APR. That's not a typo.

But here's the problem. SBA loans take 60–90 days to fund. You need a credit score above 680 (usually higher). You need clean financials. And you need to not have a pile of UCC liens from MCA funders sitting on your business. If you've got two or three MCAs stacked, the SBA is going to look at your lien history and pass.

This option works best if you've only got one MCA, your revenue is stable, and you're not behind on payments yet. If that's you, start this process now. Not next month. Now.

This is the middle ground. Lenders like Bluevine, Fundbox, OnDeck — they'll move faster than an SBA lender, and their credit requirements are lower. You're looking at 15–40% APR, with repayment terms of 6–24 months. Still expensive. But compared to the effective rate on your MCA, it's a significant step down.

The key here is your daily bank balance and monthly revenue. Alternative lenders care less about your credit score and more about cash flow. If you're doing $30K+ a month in revenue and your bank account isn't getting hammered to zero every day by MCA debits, you have a shot.

One thing to watch: some alternative lenders will want to see that your existing MCA is paid off at closing. That means the new loan funds, pays off the MCA balance in full, and you start fresh with the new lender. This is a refinance in the traditional sense. Make sure the payoff amount is locked in writing before you close — MCA funders have a habit of tacking on fees at the last minute.

This sounds like what you already have. And technically, it is. But not all revenue-based financing is priced the same. Some newer fintech lenders are offering revenue-based products with factor rates of 1.1–1.2 instead of the 1.3–1.5 you're probably paying now. That difference, on a $100K advance, is $10,000–$30,000 in savings.

The catch: you're still in a daily or weekly remittance structure. You're not escaping the ACH pulls. But you are reducing the cost of capital, and in some cases, extending the term so the daily pull is smaller. That gives your cash flow room to breathe.

This is the easiest refinance to actually execute, because the new funder understands the product. They know how to pay off the old MCA and slot into the same position. If you can't qualify for a term loan or SBA, this is your realistic play.

A line of credit works differently than a lump-sum refinance. You get approved for a credit line — say $50K–$150K — and you draw against it to pay off the MCA. Then you repay the line of credit on monthly terms at 10–25% APR, depending on the lender.

Why this is underrated: you only pay interest on what you draw. If your MCA payoff is $80K and your credit line is $120K, you draw $80K, kill the MCA, and still have $40K in reserve. That reserve is the difference between surviving a slow month and spiraling into another MCA.

The qualification bar is higher than a revenue-based product but lower than SBA. You typically need 12+ months in business, $100K+ annual revenue, and a credit score above 600. If you've got those numbers, this should be your first call.

If you've got multiple MCAs stacked (and a lot of you do — don't be embarrassed, the MCA industry is literally designed to encourage stacking), a consolidation play might make more sense than refinancing one at a time.

Here's how it works. A broker or financial advisor negotiates with your existing MCA funders to settle or restructure the balances. Then a single new lender comes in and funds one consolidated loan to cover everything. You go from 3–4 daily ACH pulls to one monthly payment.

The risk: not all consolidation offers are what they seem. Some "consolidation lenders" are just giving you another MCA with a higher factor rate that technically pays off the other ones. You haven't refinanced anything — you've just restacked with a different name on the contract. Read the terms. If the new product has a factor rate, daily ACH pulls, and a confession of judgment clause, it's not a refinance. It's another MCA wearing a suit.

This one surprises people. But it's real. Some MCA funders — not all, but some — will renegotiate the terms of your existing advance if the alternative is you defaulting entirely.

Think about it from their side. If you default, they have to chase you through collections, maybe file a lawsuit, maybe freeze your accounts. That costs them time and money. If you come to them and say "I can't sustain this daily payment, but I can pay X per week for Y months," some of them will take that deal. Especially if you're current on payments and approaching them before you're in trouble.

The window for this is narrow. Once you've already missed payments, the funder's collections team takes over, and they're not in the business of renegotiating. They're in the business of recovering. You have to do this while you still have leverage — which means while you're still paying.

What makes this work: bring financials. Show them your bank statements, your revenue trend, and a realistic repayment plan. Don't just call and say "I can't pay." Call and say "here's what I can pay, and here's why it's in your interest to accept it." That's a different conversation entirely.

It depends on three things: your credit, your revenue, and how many MCAs you're currently carrying.

If you've got one MCA and decent credit — go for the SBA or a line of credit. If your credit's been beat up but your revenue is strong — look at alternative term loans or better-priced revenue-based products. If you've got multiple MCAs stacked and you're barely keeping your head above water — consolidation or direct negotiation is where you start.

And if you're already behind on payments, some of these options are already off the table. That's the reality. The best time to refinance is before you need to. The second best time is right now, before it gets worse.