Warehouse Line for a Merchant Cash Advance Company
A warehouse line lets a merchant cash advance company borrow against the receivables it originates, keep the assets and the spread, and recycle capital as merchants remit. Advance rates commonly run 80 to 95 percent of eligible collateral.
Published: ·Last updated: ·By Ed Freeman, Capital Advisor. PeerSense
How does a warehouse line for a merchant cash advance company work?
A warehouse line for a merchant cash advance company is a revolving senior credit facility secured by your receivables through a borrowing base. You pledge eligible advances, the facility advances 80 to 95 percent of eligible collateral, you fund the remaining equity gap, and as merchants remit you repay and redraw. The desk works 10 million a month. The core book is 25 million to 100 million plus a month. First facilities can start smaller. Working lines commonly sit well above 100 million committed.
Originate 10 million a month or more? Talk to the desk.
Monthly volume, months of history, average advance size, and how you fund today. You get an honest read on whether a warehouse line, forward flow, or seasoning first is the right move. Confidential.
institutional: Response within 24–48 hours. No obligation.
How a Warehouse Facility Works for an MCA Book
The borrowing base
Your pool of pledged advances, each tested against eligibility criteria, multiplied by the advance rate, with ineligible, delinquent, or over concentrated advances excluded.
The advance rate and the equity gap
The facility advances 80 to 95 percent of eligible collateral. You fund the rest. That gap is why tangible net worth matters, and why the advance rate, not the interest rate, decides how many advances you can carry per dollar of equity.
The special purpose entity
The pledged advances are typically held in a bankruptcy remote special purpose entity, legally separated from your operating company.
Warehouse Line vs Forward Flow
A warehouse line is leverage: you borrow against receivables you keep, fund the gap, and earn the full spread. Forward flow funding is a sale. On MCA paper the buy commonly prints at 80 percent, 85 percent, or 90 percent of each funded advance.
The full comparison: forward flow vs warehouse facility for originators.
How PeerSense Places an MCA Warehouse Mandate
PeerSense sources capital through a curated network of commercial lenders and capital sources. Routing is grounded in data: lending and capital patterns analyzed across 5,475 lenders and 2.1 million loans, with 899 credit boxes profiled.
Compensation is set in a written agreement and paid at closing only.
Ready to leverage the advances you are already writing?
Monthly volume, months of history, average advance size, current funding source. You get a structure recommendation and, where the fit is real, a confidential introduction.
institutional: Response within 24–48 hours. No obligation.
MCA Warehouse Lines: Questions Operators Actually Ask
Deals We Structure
Representative profiles from the placement desk and from the forward flow network tape. Sizes and structures only. No counterparties named.
$12M Hilton flag hotel, Charlotte, NC
6.75% fixed | 65% LTV | 52 day close
$8M value add multifamily, Tampa, FL
SOFR +395 | 75% LTC | 14 day close
$6.5M mixed use development, Austin, TX
80% LTC | Interest only | 18 mo term
$2.8M QSR franchise (3 units) Indianapolis, IN
Prime +2.75% | 25 yr term. Equity injection is lender underwriting.
$3.2M/mo manufacturing AR, Cleveland, OH
1.5% factor fee | 90% advance | 48 hr funding
$1.8M 6 unit rental portfolio, Phoenix, AZ
7.25% | 75% LTV | No income docs | 1.25x DSCR
$350M to $1.5B committed purchase of future originations
True sale | Par or premium to UPB | Weekly or monthly settlement | Servicing usually retained
$100M to $500M revolving line against eligible receivables
80 to 95% advance | 2 to 3 year revolver | Often paired with a flow takeout
$200M seasoned pool sold in one trade
Priced off the tape | Off balance sheet at settle | Cash recycles into new production
Indicative only, as of August 1, 2026. Not a quote, commitment or offer of credit. Final pricing, leverage and terms are determined by the lender at underwriting, after full transaction materials are reviewed. PeerSense does not lend and does not set pricing. What these terms mean.