Published By Janet Gershen-Siegel at October 23rd, 2018
There are several online lenders but only some of them will provide a loan if you have a short time in business. Qualifications can include annual revenue and minimum personal credit score (FICO). And those requirements can vary. So can the maximum available amounts. Here are the details and the best online lenders if you have a short time in business.
We researched these online vendors and asked about their programs, rates, terms, and features.
Only Fundation Group LLC and QuarterSpot confirmed our research. Rates can rise and fall; this is normal when it comes to financing. We suggest you investigate all online lenders which interest you to confirm our numbers before requesting funding.
Balboa Capital loans up to $250,000. Get 3 – 24 month terms. No collateral needed. Cash provided in days.
There is a time in business requirement of at least one year. Another requirement is $300,000 or more in annual revenue. Balboa Capital asks for your personal credit score.
Balboa Capital also provides business cash advances. Also, Balboa Capital will advance $5,000 to $250,000. Get 3 – 18 month terms.
No collateral needed. There is a time in business requirement of at least one year. Another requirement is $10,000 or more in monthly credit card and debit card deposits.
One advantage is the size of their business cash advances and how you don’t need collateral to get such an advance.
A very big disadvantage is that their fees are not listed on their website. Decide whether this apparent lack of transparency is an issue for you.
Bond Street offers term loans of $10,000 – $1 million. Terms are up to 1 – 3 years. Bond Street will ask for both EIN and SSN.
Offer arrives within 3 days. Bond Street will only do a soft credit pull. 640 or better credit score is most likely to get a loan but Bond Street will look at other factors.
There is a 2 years’ time in business requirement. Required annual revenue is of at least $200,000. Rates start at 6% and go up to 22%. APR works out to 8 – 25%. There is a 3 – 5 % origination fee.
Advantages are the soft credit pull. Plus Bond Street will look at factors beyond your personal credit if your FICO score is low.
Bond Street can offer very large loans if you qualify. Disadvantages are the longer time in business requirement. And the maximum APR is very high.
Credibly is an emerging Fintech platform. Credibly can provide $5,000 to up to $250,000 in small business funding; this is for working capital or for small business expansion.
You must in business for at least 6 months. You must have at least $15,000 in monthly revenue (this works out to $180,000 annually). Credibly will want to read and review your company’s most recent 3 months’ worth of bank statements.
There is a 2.5% origination fee. Rates start at 9.99% and go up to 30.00%. Funding is within 48 hours.
Credibly will pull your personal credit and this will impact your personal credit score. Credibly also wants a personal guarantee. They also want you to provide collateral for funding. Credibly is going to place a lien on your business if you cannot.
Advantages include a short time in business requirement. Disadvantage/wild card is that the company is fairly new (since 2010).
Plus Credibly is in Fintech, an umbrella term which includes blockchain and crypto currencies. Hence their model could change radically in short order as this technology continues to improve.
Fundation Group LLC confirmed this information. There are no prepayment fees or hidden fees of any kind on their products. Fundation Group LLC will use simple interest rates and never use factor rates. And Fundation Group LLC offers term loans and lines of credit. For term loans: $20,000 – 500,000 is available. Funding is as soon as one business day. Terms: 1 – 4 years.
Payments are twice per month. No specific collateral needed. Fundation Group LLC wants a personal guarantee. There is also a UCC-1 blanket lien for most borrowers.
And there is a one year time in business requirement. A company must have at least 3 employees. Your company must have $100,000 or more in annual revenue. A borrower will need to have good personal credit.
Rates are risk-based. So the higher the risk is, the higher the rate. APR is 7.99% – 29.99%. There is up to a 5.0% origination fee. So this is deducted from net proceeds. There are no prepayment fees.
For lines of credit: $20,000 – 100,000 is available. New balance after each draw is amortized in equal installments over 18 months. Payments are monthly. No specific collateral necessary. But Fundation Group LLC wants a personal guarantee.
There is also a UCC-1 blanket lien for most borrowers. There is a one year time in business requirement. A company must have at least three employees. And a company must have $100,000 or more in annual revenue. The borrower will need to have good personal credit.
There is a $500 closing fee. 2.00% draw fee is deducted from each draw.
Advantages include a short time in business requirement. Closing fee is low and is a flat rate. Disadvantages include draw fees and a very high maximum APR.
Fundera provides term loans, business lines of credit, and invoice financing. For term loans: 1 or more years’ time in business is a must. You also must have a 600 or better credit score. A company must have $90,000 or more in annual revenue.
You can get term loans of $25,000 – 500,000. Terms are of 1 – 5 years. It is as little as two days to approval. 7 – 30% interest rates. There are possible prepayment penalties.
Business Lines of Credit
You must have six or more months’ time in business. A company must have $50,000 or more in annual revenue. $10,000 to over $1 million in funding is available.
There are 6 months to 5 years terms. Approval is in as little as 1 day. There are 7 – 25% interest rates. This funding may require collateral. There are higher rates for lower credit scores.
You must have six or more months’ time in business. A company must have $50,000 or more in annual revenue. Maximum advance is equivalent to 50 – 90% total amount of invoice.
Approval is in as little as one day. When the customer pays, you receive the remaining 10 – 50% minus fees. The fees are generally 3% plus a percent/week outstanding. Fees are based on time it takes for customer to pay off the invoice.
Advantages include flexible options. There is a fairly low annual revenue requirement. Disadvantages include your fees are based on how fast your customer pays. So deadbeat customers will cost you.
Kabbage offers lines of credit. Up to $150,000 is available. You can qualify in 10 minutes. There are terms of 6 or 12 months. The 6 month loan minimum is $2,000. A 12 month loan minimum is $10,000.
Your company must be in business 1 or more years. Business revenue must be $50,000 annually or $4,200/month over the last 3 months.
Kabbage links to your bank or merchant accounts to understand your cash flow and decide how much you can afford to borrow. There are lines of credit from $2,000 to $150,000. There are no fees to apply or establish your line.
Pay fees only on what you take. Fees range from 1.5 – 10%. Rates are based on business performance factors. Save money with early payments.
Advantages include fairly low fees. Revenue requirement is relatively low. Disadvantages include less term flexibility for smaller loans. This is because loans under $10,000 can only be for a 6-month term.
Lending Club offers term loans. It has business loans from $5,000 to $300,000. Loan terms are 1 – 5 years. Get a quote in less than 5 minutes. Funds are available in as little as 48 hours with approval. There are no prepayment penalties.
Your annual revenue must be $75,000 or more. And you must be in business for 2 years or more. You must have a personal FICO score of 620 or better. There are rates of 5.99% – 29.99%. Total annualized rates start at 8%.
Advantages are that the annual revenue requirement isn’t too high. Funds are available quickly. Disadvantages include high maximum rates.
Quarter Spot offers short term loans. $5,000 – $150,000 is available. The terms are 9 – 18 months. Quarter Spot will only do a soft credit check when you apply. QuarterSpot confirmed this information with us.
Your company must have annual revenue of $200,000 or more. You have to have a personal FICO Score of 550 or better. There is no fee to apply.
Minimal time in business is 12 months. You must have a minimum average bank balance of $20,000. And you must also show a minimum of $16,000 in monthly sales.
The borrower must own at least 50% of the business. And the rates are 25% – 40%.
Advantages are that the personal FICO score requirement is relatively low. Minimum average bank balance requirement is also fairly low.
Disadvantages are this is not for sole proprietors AT ALL. Maximum rates are very high.
Rapid Advance offers standard, select, and preferred loans.
$5,000 – $1 million is available. The terms are 4 to 12 months.
Your company must have annual revenue of $120,000 or more. You must have a personal FICO Score of 580 or better. The minimum time in business is 2 years. And there is a 1.16 to 1.30 factor rate.
$15,000 – $1 million is available. The terms are 6 to 15 months. You must have annual revenue of $240,000 or more. And you must have a personal FICO Score of 620 or better. The minimum time in business is 3 years. There is a 1.12 to 1.31 factor rate.
$15,000 – $200,000 is available. The terms are 9 to 18 months. You must have annual revenue of $240,000 or more. And you must have a personal FICO Score of 660 or better.
The minimum time in business: 6 years. You must have minimum bank balance of $10,000 or more. And borrowers must have at least 10 deposits from 5 different sources every month. There is a 1.11 to 1.25 factor rate.
So advantages are a few choices for loan types. Also, maximum amounts available are high.
In addition, disadvantages are minimum bank balance requirements are fairly high. Annual revenue requirements are also high.
Getting funding with fairly short time in business is not easy. Here are some pros and cons.
The shortest time in business requirement is 6 months at Credibly. The lowest minimum personal credit score (FICO) is 550 at QuarterSpot. But Bond Street will look at other factors if your personal credit is less than stellar.
The lowest annual revenues required are $50,000 at Kabbage and for Fundera invoice financing. Also, the most available is $1 million from Bond Street and Rapid Advance standard loans. And you can get over $1 million with a Fundera business line of credit.
So as with all funding sources, make sure to read the fine print carefully. Your own individual requirements and needs are most important when determining where to get business funding.