What is the true cost of a merchant cash advance?

MCA costs are often stated as factor rates (1.2-1.5) rather than APR, obscuring the true cost. A $50,000 MCA with a 1.4 factor rate means you repay $70,000. Repaid over 6 months through a 15% daily sales remittance, the effective APR can exceed 100-150%. MCAs should be a last resort — the cost of capital is extremely high compared to any other financing option.