Questions to ask before taking business financing

• Is the quoted amount the gross amount, or the actual cash I will receive?
• Are there origination, closing, processing, or other fees — and are they deducted from the funding amount?
• Can I see a full funding breakdown before I sign?

• What is the total amount I will repay over the full term, including all fees?
• Is the cost expressed as an interest rate, a factor rate, or a fixed total repayment?
• Does paying early reduce the total cost, or is the full repayment fixed regardless?
• Is there a prepayment penalty?

• Is payment collected daily, weekly, or monthly — and on which days?
• Are payments automatically debited, and from which account?
• Can the payment amount or frequency change over the term?

• Is a personal guarantee required, and from whom?
• Will there be a UCC filing against the business?
• What collateral, if any, secures this financing?
• What exactly happens after a missed payment — fees, default triggers, acceleration?

Some financing businesses earn most of their revenue from renewals and refinancing. It is fair to ask how renewal works and what it costs — a structure designed to be renewed is a structure designed for you not to finish paying.

If any answer is vague, slow, or verbal-only, treat that as an answer.

A financing agreement is a legal contract. For anything you do not fully understand — especially guarantees, UCC filings, and default clauses — a review by your own attorney or accountant is worth more than any guide, including this one.