What Is It?
Debt refinance and consolidation means replacing one or more existing obligations with a new financing structure — ideally one with more sustainable payments, a longer term, or a lower overall cost. For businesses carrying multiple short-term obligations (including stacked Merchant Cash Advances), this may involve a term loan refinance, an MCA buyout, a debt consolidation structure, or longer-duration financing. Refinancing is not guaranteed, and not every business qualifies — but for those that do, the goal is a structure the business can actually support.
When It May Make Sense
- Existing payments are consuming too much cash flow
- A business has multiple short-term obligations it wants to consolidate
- The business qualifies for a longer-term, lower-payment structure
- Refinancing would meaningfully improve cash flow without adding net debt
When It May Not Make Sense
- The business doesn't qualify for better terms than it already has
- Refinancing would increase total cost even if it lowers the payment
- Taking on new debt to solve a structural cash-flow problem
- Situations where the existing obligations can't legally be refinanced (e.g., certain MCA positions under SBA rules)
What Lenders Typically Evaluate
- Current debt schedule and payment burden
- Business revenue and cash flow
- Ability to service the new, refinanced payment
- Credit profile and time in business
- Existing obligation types and whether they can be paid off or restructured
- Collateral, where applicable
- Overall debt-to-income and debt service coverage
Potential Benefits
- Can lower the monthly payment and improve cash flow
- Can consolidate multiple payments into one structure
- Longer term can reduce per-period pressure
- May reduce the overall cost of capital in some cases
Risks & Considerations
- Refinancing is not guaranteed and depends on qualification
- A lower payment over a longer term can increase total cost
- Some obligations (including certain MCAs) may not be eligible for specific refinance programs
- Adding new debt on top of old debt can worsen the situation if not structured carefully
What to Prepare
Common items lenders may request — requirements vary by program and lender.
- Complete debt schedule (lender, balance, payment, term for each obligation)
- Business bank statements and financials
- Information on each existing obligation type
- Business and owner credit information
- Revenue and cash-flow documentation
- Description of the goal (lower payment, consolidate, extend term)
Frequently Asked Questions
Not necessarily. A lower payment depends on qualifying for a structure with better terms — a longer term, a lower rate, or consolidation. A longer term can lower the per-period payment but may increase total cost over the life of the loan. We don't guarantee any payment reduction or qualification.
Under SBA SOP 50 10 8, Merchant Cash Advance and factoring arrangements became ineligible for SBA debt refinancing effective June 1, 2025. Businesses should not assume an SBA loan can refinance existing MCA obligations. Alternative private, conventional, or asset-based structures may need to be evaluated.
Refinance replaces an existing obligation with a new one (often to improve terms). Consolidation combines multiple obligations into a single new loan. The two often happen together — consolidating several debts into one refinanced structure.
Explore Your Options
Submit your information and our team will review which available capital structures may be appropriate for your business or project.
Financing is subject to underwriting, eligibility, and approval. Products, terms, and availability vary by program and lender. Submitting information does not guarantee approval or funding. This page is educational and is not financial, legal, tax, or investment advice.