Merchant Cash Advance in Arlington: When Invoices Pay Slower Than Bills

The gap between work and payment

Arlington is a city in Tarrant County and part of the Mid-Cities region of the Dallas-Fort Worth metropolitan area. The 2020 census counted 394,266 people, making it the second-largest city in the county after Fort Worth and the third-largest in the metropolitan area. Wikipedia adds that it is the largest city in the state that is not a county seat.

Contractors, suppliers, staffing firms and haulers in a city this size often invoice larger customers on terms. Labor, materials and fuel are paid first; the invoice is paid later. That gap is the reason cash advance questions come up.

What the law says about late payment, in one line

Texas Property Code section 28.004 provides that overdue amounts under covered construction contracts accrue interest from the day after the due date at 1-1/2 percent per month. This is a summary, not legal advice, and you should check the statute to see whether your contract is covered. It is a reminder that late payment has a cost on both sides, and that written payment terms are worth having.

A worked example, for illustration only

A drywall contractor in Arlington finishes a job and invoices $48,000 on thirty-day terms. Crew pay and materials have already gone out. The next job needs $20,000 of materials this week. Waiting for the first invoice delays the second job, which delays the next invoice.

This is an illustration, not our terms or a typical outcome, but it shows the real question: how many days of gap are you covering, and what does covering them cost? Compare that against the value of starting the second job on time.

Reading your own receivables

Before looking at any structure, list your open invoices by customer and by age. Most owners find that one or two customers account for most of the late money. That list tells you how large the gap really is and how long it tends to last. It also shows whether a different fix, such as tighter payment terms or a deposit up front on new jobs, would shrink the gap on its own. Funding fits best when the gap is temporary and the receivables are real.

Questions to put to any funder

1. How is repayment collected, and how often?
2. What is the total repaid for the amount received?
3. What happens if the customer's invoice is paid late?
4. Can the business pay early, and does that change the cost?

A merchant cash advance is generally described as money received up front and repaid from future sales, and structures vary.

Where Arlington owners go next

See pages on construction, restaurants, healthcare, retail and tourism. For other structures, see working capital, equipment financing, lines of credit, term loans and same-day funding.

Requests run from $25,000 to $5,000,000, with funding in as little as 24 hours once the application is complete. The application takes about five minutes, uses a soft credit pull and is open to sole proprietors. Apply here.