Should I take a bigger amount than I asked for?

Two structures, opposite answers, and the upsell is delivered the same way for both. The question is whether the facility charges you per dollar committed or per dollar drawn. On a revolving line, unused limit costs a small fee and nothing else. On a fixed-cost product, every dollar funded carries the full cost the moment it lands — so unused money is a pure, permanent loss with no offsetting benefit.

A funder offering more than you asked for is not doing you a favour and is not making an error. On fixed-cost products, the size of the deal is the size of the revenue, and increasing it is the single easiest thing a salesperson can do to a transaction.

Where taking more is wrong

• Cost on $70,000: $24,500.
• Cost on $100,000: $35,000.
• The extra $30,000 costs $10,500 — whether you spend it, hold it, or leave it in the account untouched.

Now look at what it does to the term. At a 12% specified percentage on $85,000 of monthly collections, the remittance is $10,200 a month either way. The smaller deal clears in about 9.3 months. The larger one runs 13.2 months. You have added $10,500 of cost and four months of a daily debit for money you did not have a use for when you applied.

The pitch is usually "take it while you can qualify" or "you'll find a use for it". The first is an argument about the funder's appetite, not your need. The second is how a working capital facility becomes a structural obligation.

Where taking more is right

• The extra $30,000 of limit costs $150 a year while it sits unused.
• If you need $30,000 next year and the line is not there, the realistic substitute is an advance. At a 1.32 factor that is $9,600.

The break-even is stark: the extra limit is worth carrying if the probability of needing it exceeds about 1.6% a year. For any real business, it does. Take the limit.

The middle case: a term loan you do not fully need

A larger term loan sits between the two. Interest accrues on the outstanding balance, so unused proceeds are not quite as wasteful as on a factor-priced deal — but an origination fee is charged on the full amount, the payment is sized to the full amount, and the whole balance counts against your debt service coverage ratio for every future application.

If the extra money is genuinely idle, the fee and the coverage effect are real costs for no benefit. If it is a buffer against a known risk, that is a use and it should be named.

The question behind the question

A larger approval than you asked for sometimes means your request was too small. Under-borrowing is a real failure mode: a business that takes $40,000 to solve a $70,000 problem comes back in four months and takes a second position at a worse price, having paid twice for one problem.

So before you refuse, check whether the original number was right. Rebuild it from the cash flow: what the money does, when each dollar goes out, when it comes back. If that model says $95,000, take $95,000 and be glad somebody noticed. If it says $70,000, the extra $30,000 is somebody else's revenue.

The questions that settle it

1. Is this facility priced on the committed amount or the drawn amount? Ask it exactly that way. The answer decides everything else.
2. Can I name a use, with a date, for every extra dollar? Not a category. A use and a date.
3. What does the extra money do to my term and my payment? On a percentage-based remittance, more money means more months at the same monthly burden, which is a different kind of cost.
4. What does the larger balance do to my next application? Coverage is calculated on the payment you took, not the money you used.

What to ask for, and what to refuse

Ask for both amounts quoted in full: total repayment, total cost, payment, term and every fee, on the amount you asked for and on the amount offered, in the same document. Seeing $24,500 next to $35,000 ends most of these conversations.

Ask whether accepting the smaller amount changes anything else — some funders reduce the offer's other terms when you reduce the size, and you should know that before you decide.

Ask, on a revolver, what the unused line fee is, whether the limit can be reduced at the lender's discretion, and what triggers a review. An uncommitted limit that disappears when you need it is not the insurance you thought you bought.

Refuse "take it now in case you need it later" on any product where the cost is fixed at funding. Refuse to treat an approval as a recommendation — it is an appetite, and appetite is not advice. And refuse to increase a request at document stage, after you have already checked the arithmetic, on a phone call.