An offer arrived before I was ready. Take it or wait?

The comparison people make is offer versus nothing, and on that comparison almost any offer wins. The real comparison has three terms: what this costs, what a better-prepared version of your file would plausibly be offered, and what the delay costs in between.

Term one: what this offer actually costs

Not the payment. The total.

Two things to note. A factor rate has no time dimension, so 17,500 of cost over five and a half months is a very different proposition from the same 17,500 over eighteen, and the only way to compare it with an interest-bearing alternative is to work out the term and convert. And 12,189 a month is the figure that has to coexist with everything else leaving your account, which is a separate question from whether the total cost is acceptable.

Term two: what your file would produce later

Be specific rather than optimistic. What changes, by when?

If two existing obligations retire in four and seven months, your debt service falls by a known amount on known dates and your coverage calculation changes accordingly. If you cross a time-in-business screen in six weeks, a different tier of product becomes available. If your third consecutive clean statement month completes at the end of next month, the window you can submit changes.

Those are concrete. "My credit will be better" is not, and a business credit score that is three months old is not going to move a decision.

Term three: what waiting costs

Quantify it. If the money buys equipment that removes 3,200 a month of subcontract cost, each month of delay costs 3,200 plus whatever the constraint costs in work you cannot take. If it refinances an obligation costing 12,189 a month into one costing 4,000, each month of delay costs roughly 8,000.

If you cannot name what the money does and what that is worth per month, the delay costs nothing measurable, and that is itself the answer.

The decision procedure

1. What does the money do, and what is that worth per month? If there is no answer, do not take the offer. Money taken because it was offered is the most expensive money there is.
2. Is the return greater than the cost, over the actual term? Compute both in dollars over the same period. Not a rate against a rate.
3. Can the payment be serviced on your worst week, not your average? Run the daily debit against your actual deposit pattern. A business with three deposits a month and nineteen dry banking days has to carry a daily debit out of balance, and that is how negative days come back.
4. Does the structure damage the file you are building? This is the one people skip. A daily debit on statements that were finally clean reintroduces the pattern you spent two quarters removing, and an anti-stacking clause may block the better facility you were heading toward. Read the clause before you sign, not after the next offer arrives.
5. What changes in the next quarter, on a date? If a screen is crossed or an obligation retires, price the wait against those dates.
6. Is the offer contingent on speed? An offer that evaporates if you take three days to read it is telling you something about the counterparty.

The middle path most people miss

Take less. An offer is a maximum, not a requirement, and the amount is usually negotiable downward without any argument. If the equipment costs 22,000 and the offer is 50,000, taking 22,000 costs proportionally less, services more easily, and leaves capacity for the better facility later.

Or take a different structure from the same funder. Weekly instead of daily changes the balance requirement considerably. A shorter term at a lower total cost, if offered, is often available and rarely volunteered.

Or ask what would have to be true for a better offer, and get the answer in writing. A funder who says "come back with two more clean months and this improves" has given you a dated plan and a reason to wait. One who will not answer has told you the offer is the offer.

Three situations where the answer is usually clear

What to refuse regardless

Refuse to sign before you have the full fee list, in writing, including anything netted from the funded amount rather than added to the balance. Refuse an offer whose documents you have not read to the end, particularly the default, confession of judgment where still used, jurisdiction and anti-stacking clauses. Refuse pressure framed as an expiring approval.

And refuse to take an offer purely because you spent six months becoming eligible for one. Sunk effort is not a reason. A business that can now attract offers can attract another one next quarter, and the file that produced this offer will produce a better one — which is exactly the position you were working toward.