Monthly Payment Loans for Small Businesses

An Overview of the Benefits

What makes our partnership with US Server Supply’s program both attractive and beneficial to a small business is the following: 

1. MONTHLY PAYMENTS

Clients will never have a weekly or daily repayment. Their payback will be on monthly payments. This causes less stress on cash flow for a small business or practice. 

2. 5 YEAR TERM

Clients can choose a 3, 4- or 5-year term to spread costs and reduce the size of monthly payments down to a manageable and affordable amount each month.

3. COSTS LESS THAN A HIGH INTEREST CREDIT CARD

Because of the structure of the transaction (created by US Server Supply’s Agreement with the clients), from just a cash perspective, after writing this off as an operational expense, a client’s true cost of funds will be somewhere between 17% and 22% per year simple interest, times 5 years. Usually in the 18%-19% per year range (APR figures higher). 

4. DOES NOT COUNT AS PERSONAL DEBT

 This will not report to the client’s personal credit reports as personal debt. Therefore, if a client desired, they could potentially use the cash back provided to their business to pay themselves, so they can then pay down personal revolving debt balances for the purpose of increasing their personal credit scores. This could in turn make more traditional types of financing available to them, as their revolving balances will be decreased, and their personal debt to income ratio will not have increased due to getting this financing. 

5. WILL NOT REPORT TO PERSONAL CREDIT REPORTING AGENCIES

 Unless a client defaults this will not report to any of the personal credit reporting agencies. The only thing that will ever show is one bank or leasing company inquiry per transaction. US Server Supply only does a soft pull of personal credit and will also run a full Dun & Bradstreet report and an Experian Business credit report to get a full credit profile on each client. That is so when we give you pre-approvals on your clients, over 9 out of 10 of those pre-approvals will turn in to full bank or leasing company approvals. 

6. PROVIDES AN ONGOING TAX DEDUCTION

Because of the structure of the written Agreement between US Server Supply and each client, their accountants will be able to write off the entirety of all payments (principal, interest and sales tax) for the duration of the client’s 3rd party finance agreement (5 year lease). The client will be able to write this off on the P & L side as an operational expense for both a federal and state tax deduction. 

7. BUILDS BUSINESS CREDIT AS IT IS PAID OFF

 As clients pay this off it will report automatically to Pay Net, and to either Experian Business, Equifax Business, or both. Clients could also buy D & B Credit Builder to add it in there; but that is usually not necessary. The bottom line is that paying this off will lead to having an easier time in the future for getting traditional funding, if the clients continue to take care of their personal credit and their businesses stay profitable with good money management. 

8. DOES NOT COUNT AS A FUNDING POSITION

 The cash back the client gets does not count as any type of funding position. By contract – Half the cash they get back is called a “payment assistance incentive” (which is actually a rebate), and the other half is called an “advanced buyback payment” (which is actually the client selling US Server Supply the equipment back after they pay it off, in exchange for a cash payment now). Does that sound familiar: get cash now in exchange for the purchase of something in the future? Only in this case it is not receivables, with repayment beginning tomorrow, or next week, it is enterprise class IT equipment 5 years out. When the client gets this 2-part, contractually owed cash back from US Server Supply in one wire payment, it does not show in their business bank account as a funding. It instead shows as payment for the fulfillment of a contact (which is exactly what it is). Your clients will remain in whatever position they are in with both the MCA world and banking industry.

9. THERE ARE NO RESTRICTIONS ON USAGE

 The client will not have to pay down any merchant cash advance positions or any other funding with the cash they get. Technically the cash’s purpose is to help pay for the costs of the IT system for the first 2 years or so; but what they do with it is on them. No judgments here. Some clients need cash for working capital now; and if so, this product makes sense. 

10. WILL NOT INTERFERE WITH OTHER FUNDING PRODUCTS

 The UCC filed by whichever leasing companies or banks our vendors utilize to secure the client 3rd party financing will either file no UCC or will file a zero-dollar amount UCC that says “equipment” on it. This makes it so anyone looking knows it is an equipment lease UCC and not a loan, line of credit or merchant cash advance UCC. Add to that, the fact that the money appears in the client’s business account with a memo declaring that it is payment for satisfaction of a contract (which it is), and there is no MCA provider that could call this (or view it as) a “position”, and there is no bank which would require the client to pay off equipment leases in order to provide traditional the client traditional cash financing. 

11. PROVIDES SOMETHING USEFUL TO THE BUSINESS BESIDES CASH

 Besides getting unrestricted, non-interfering cash, on a 5 year term, with monthly payments that does not count as personal debt or report to personal credit; but builds business credit as it is paid off; the client also gets something else that potentially has great value for their business or practice. Each client gets, per IT system, one unused, Hewlett Packard Enterprise DL 380 Gen 10 server with multiple hard drives, installed RAID and a software license, that is also protected for 5 years with an extended warranty and that also comes with data back up and disaster recovery protection. These IT systems can be installed and networked anytime the client wants and can even be temporarily used as high-powered computers and data storage, simply by adding a mouse, keyboard, and monitor, and installing the Windows operating system provided.

Frequently Asked Questions

 1. WHAT EXACTLY IS THE PROGRAM?

The program is a simple construct that is designed to allow small businesses, medical practices, and professional practices the ability to obtain substantial cash back through the purchase of an entire IT system. It works extremely well for clients seeking cash, and who also may desire, at some point, to upgrade their current IT infrastructure. It also can work well for qualified clients who just want affordable working capital on monthly payments, yet who may not have a current need for any IT infrastructure upgrade.

2. WHAT IS THE STRUCTURE OF THE FUNDING?

The funding is paid to the client directly by US Server Supply within no more than 3 days of the client verifying receipt of their IT system to the vendor and 3rd party financier (which is 79 business days after applying). The structure of the funding (cash back) to the client is 2 parts in one payment. When the vendor is paid by the 3rd party financier the vendor pays, via bank wire, US Server Supply’s invoice to the vendor (for the hardware, software, extended warranty, and client referral charge) that same day. Then US Server Supply pays the client and the associated referral partner that same day they receive payment for their invoice to the vendor.

3. Is this through a direct funder?

US Server Supply is considered the direct funder in this because: A. US Server Supply is the one paying the client based off an electronically signed agreement that exists only between US Server Supply and the client. The client is not being paid by the vendor or by any 3rd party financier. B. US Server Supply is receiving the funding to pay the client as legitimate payment of an invoice to its vendor for server hardware, software, an extended warranty, and a client referral charge. US Server Supply is not getting paid by a bank or leasing company (3rd party financier) and just slicing off a portion to the client, acting as a middleman. C. US Server Supply has no direct connection to the 3rd party financier the vendor used, and therefore has no privity of contract with any 3rd party financier. US Server Supply sells the equipment, software, and extended warranty to the vendor for a set price. The vendor adds a data backup and disaster recovery coverage and sells that whole package to a 3rd party financier (on behalf of the client) who pays only the vendor and does not pay US Server Supply or the client. The vendor pays US Server Supply’s invoice immediately upon receipt of payment from the 3rd party financier, and then US Server Supply immediately pays the client their contractually obligated funds and pays the associated referral partner/broker.

4. WHAT IS THE STRUCTURE OF THE REPAYMENT?

The repayment is an equipment lease spread out over 60 months with a $1 buyout. The client can also choose 36 or 48 months. The good news is that because of the Agreement the client signs with US Server Supply prior to entering in to a 3rd party finance agreement with a bank or leasing company, the client’s accountant will be able to write off the entirety of the payments both federally and at a state level, as an operational expense.

5. HOW DO I GET MY FUDS?

US Server Supply is the payor of funds to the client. These monies are wired to the client’s bank account by US Server Supply the same day that US Server Supply’s invoice is paid by the vendor handling the client’s 3rd party financing and data back up and disaster recovery protection. Said vendor will pay US Server Supply the same day they are paid by the 3rd party financier (bank or leasing company). The whole process of the transaction usually takes 7-9 business days from start to finish (from application submission to funding).

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