Funding Circle Small Business Loans
Funding Circle is an online marketplace lender offering fast and affordable business loans to small business owners in need of some extra cash. Whether you're in need of new equipment or are hoping to increase your marketing budget, Funding Circle can help.
Funding Circle's business loans start at a low 5.49% APR for terms up to 12 months. Business owners can lock in up to $500,000 in as little as five business days. Funding Circle offers 100 percent transparency, meaning there are no hidden fees and there won't be any surprises along the way.
Terms range from 12 to 60 months with interest rates ranging from 5.49% to 20.99%, depending on the length of the loan and your personal credit profile. Borrowers with strong credit scores will receive better interest rates than borrowers with poor credit scores. Interest rates are always fixed and payments will remain the same throughout the life of the loan. Origination fees on each loan range from 4.99% to 4.99%, again depending on your credit score.
Because the terms are shorter than some comparable services, monthly payments will be higher, especially on loans for hundreds of thousands of dollars. However, you'll pay less interest over the life of the loan because you're paying it back in a shorter period of time.
With Funding Circle, you can borrow as little as $25,000 up to the limit of $500,000. The one to five year loan terms are designated in one year increments. Typical uses for borrowed funds are business expansion, investing in new equipment or a marketing program, change of location or hire staff.
As an example, a $150,000 loan over a 36 month term would require a monthly payment of $4,769 to $5,712, depending on your interest rate. The rate is in the 8.99% to 21.79% range, depending on your creditworthiness. After a loan origination fee of $7485 (a 4.99% fee), you receive a loan amount of $142,515. The total cost of the loan is in the $171,693 to $205,642 range.
The best interest rates are available on the 12 month term loans. Here are sample rate comparisons for a $150,000 loan. For a 12 month loan, the interest rates run from 5.49% to 18.29%. The rate range on 24 month loans is 7.99% to 20.79%. On 48 month loans the interest rate run from 9.79% to 22.79%. The 48 month loan terms feature the highest possible rate from Funding Circle. The rates for a 60 month loans fall in the 10.49% to 18.29% range at the $150,000 loan amount.
This sample above illustrates rate variations depending on the term of your loan, but the rates also vary with the amount you borrow. A 36 month loan for $400,000 has an interest rate range of 8.99% to 16.29%, for example. Note that the lower end of the interest rate range is the same as it is for a $150,000 loan, but the higher end of the range is a whopping 4.5% less.
It's important to borrow money for a specific purpose and to be sure your business cash flow can handle the payments, especially if you are paying in the higher range of these interest rates.
As mentioned above, you will pay a loan origination fee with Funding Circle. Other fees include a late payment fee of 10% of the missed payment. The fee is added to your monthly payment and debited from your account. If there is not sufficient funds in your account to cover your automatic payment, there is a non-sufficient funds fee of $35.
You can check your eligibility for a Funding Circle small business loan and apply online in about ten minutes. Loan specialists are available to help you with your application. Underwriters review you application and may schedule a phone call with you for more information on your business. You'll get a decision on your loan as quickly as 72 hours. Once approved, you'll be funded within a few days. The complete process from application to funding can be completed within ten days.
In determining loan approval and interest rates, Funding Circle looks at your credit score and and assigns applicants a risk band. Many factors are weighed in assigning the risk band, including the applicants business record and commercial invoice payment history. The risk bands range from A+ to E, where A+ is lowest risk. Upon approval Funding Circle notifies you of your risk band and interest rate.
Funding Circle offers borrower support via phone and email. The website states that emails are answered within two working days. There is also a customer support web page that includes an extensive frequently asked questions for borrowers section.
Funding Circle History
Funding Circle was created with an audacious credo, to revolutionize the outdated banking system and secure a better deal for everyone. The company was started by small business owners seeking to change the funding process for small businesses. Co-founder and CEO Samir Desai is profiled at the Funding Circle website, along with his leadership team and board of directors.
They claim the title of the world's leading lender marketplace focused on small business, with more than $1.5 billion lent to 12,000 businesses in the United States, UK, Germany, the Netherlands and Spain. Funding Circle maintains offices in San Francisco and London.
Verdict - Great
With so many positive reviews and features, Funding Circle is clearly doing something right. The company has lent more than $1 billion to 10,000 businesses across the US and UK. Featured in The New York Times, The Wall Street Journal, Bloomberg, and more, Funding Circle is successfully filling a void in the small business market. With some term loans charging interest rates up to 70 percent, it can be impossible to grow your business. Funding Circle has raised more than $300 million in equity capital since 2010 and is seeking to change the way small business owners borrow money.
The application is quick, funding takes place within 14 days and there are no hidden fees. Created by small business owners for small business owners, Funding Circle is one of the best business loan choices available for your small business.