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- Lendio helps business owners access a wide variety of loan options for small businesses.
- Borrowers don’t necessarily need an extensive business history to qualify.
- Lendio matches borrowers with a lender best suited to them.
What we like:
A wide variety of loan options and access to several lenders through one application
|Loan Amounts||Up to $2 million|
|Loan Terms||1 – 5 years|
|Fixed Rates||Starting at 6.00%|
|Other Loan Types||Short-term loan, accounts receivable financing, business line of credit, SBA loans, merchant cash advance, equipment financing, equipment financing, startup loan, business acquisition loan|
For small business owners, funding can be one of the first major hurdles you face. Several types of financing exist to give you the boost you need. Lendio, a loan aggregator, can help you compare several types of small business financing to find a product and lender for your company.
But is Lendio legit? This Lendio review will cover what types of loans you can find through Lendio, how to apply, and the pros and cons of seeking a small business loan through the lending marketplace.
In this review:
- Lendio business loans: At a glance
- Pros & cons of Lendio loans
- Eligibility & application requirements
- Lendio alternatives
Lendio business loans: At a glance
|Lendio Small Business Loans||Loan amounts||Loan terms||Time to funding||Interest rates|
|Small business term loan||$5,000 to $2 million||1 – 5 years||Not Disclosed||Starting at 6.00%|
|Short-term loan||$2,500 to $500,000||1 – 3 years||As soon as 24 hours||Starting at 8.00%|
|Accounts receivable financing||Up to 80%||Up to 1 year||Not Disclosed||Starting at 5.00%|
|Business line of credit||$1,000 to $500,000||1 – 2 years||As soon as 1 – 2 weeks||8.00% to 24.00%|
|SBA loans||$50,000 to $5 million||10 – 25 years||30 – 90 days||Not Disclosed|
|Merchant cash advance||$5,000 to $200,000||Up to 2 years||As soon as 24 hours||Starting at 18.00%|
|Equipment financing||$5,000 to $5 million||1 – 5 years||As fast as 24 hours||Starting at 7.50%|
|Startup loan||$500 to $750,000||Up to 25 years||As soon as 2 – 4 weeks||0.00% to 17.00%|
|Business Acquisition Loan||$5,000 to $5 million||10 – 25 years||As soon as 30 days||Starting at 5.50%|
Which business loans does Lendio offer?
Lendio is a business loan marketplace with the goal of helping small businesses succeed. It helps you compare a variety of financial products to assist in all facets of small business ownership.
Through the site, you can seek the following types of small business lending.
Business term loan
Business term loans you can find through Lendio feature fixed interest rates and loan amounts as low as $5,000 and up to $2 million. With that variety, businesses are likely to find the financing they need with a business term loan.
In many ways, a short-term business loan is similar to a business term loan, but with one important difference: As the name implies, you will repay the debt on a more stringent timeline, between 1 year and 3 years.
With loan amounts capped at $500,000, this loan is a solution worth considering for small businesses that don’t need a large sum to get going.
Accounts receivable financing
If you’ve owned a business for a while, you likely know what it feels like to have someone owe you money—for longer than they should.
With accounts receivable financing (also called invoice financing), you can gain quick access to cash by using your unpaid invoices as collateral. This lets you improve cash flow with a short-term loan up to 5 years.
Business line of credit
For those who want to improve cash flow without putting up collateral, a business line of credit is an option.
Funds are there if you need but there is no obligation to draw from it. You’ll only pay interest on the funds you use, not the total amount you’re approved for. That makes this option flexible and cost-effective for cash-strapped small businesses.
Federally-backed loans through the U.S. Small Business Administration (SBA loans) come with flexibility and low risk to lenders, so you can find favorable terms and rates.
Lendio can help you find SBA loans for specific purposes like construction, project funding, or purchasing property, as well as more general SBA financing available as working capital or lines of credit.
Merchant cash advance
If your small business is strapped for cash and doesn’t have days or weeks to wait for loan approval, a merchant cash advance could be a solid option to bridge the financial gap.
As soon as 24 hours after approval with a Lendio partner, you can receive funds for this short-term, high-interest loan.
Buying the physical pieces to get your business up and running can come at great cost, and Lendio knows that. Its equipment financing partners can help you find equipment loans to purchase whatever you need—from a backhoe to a blender.
One of the biggest hurdles for getting a small business loan or another type of financing is proving your business revenue is solid. For a startup, that could be tough.
Startup loans cut down on this requirement. Most Lendio partners will want to see that you have experience in a field related to your startup, and some may require collateral, like a car or house.
This could be risky, but it may make financing more accessible to new companies.
Business acquisition loan
If the opportunity arises to acquire another business but cash is hard to come by, Lendio can help you find a business acquisition loan.
The requirements for applying for this type of loan are stricter than for other small business loans: records of the business’s financial performance and valuation, a business plan, and financial projections.
The lender will also want you to prove you have the experience to handle managing a new business.
Pros & cons of Lendio loans
- Variety of financing options to suit many needs.
- Lendio partners with multiple lenders to help you find the one that fits your situation best.
- Competitive rates and terms across loan products.
- Most businesses need to have a solid history to qualify.
- Minimum loan amounts may be too high for what some businesses need.
- It can be challenging to know whether you will qualify before you apply.
Eligibility & application requirements
The criteria you need to meet to get a loan through Lendio varies by loan type. But most loans you’ll find have similar eligibility requirements:
- Business should be at least six to 12 months old.
- At least $50,000 in annual revenue.
- Borrower credit score of at least 650 to 680.
- Proof of solid cash flow and revenue for the last three to six months.
Some lenders may also require specific information about your business, such as income ratios, a business plan, and revenue projections.
How to apply for a Lendio loan
Lendio is known for its fast and easy application process. You can complete an application in 15 minutes online.
Lendio will show you a list of lenders that match your criteria and needs, and from there, you can complete the online application process with the lender of your choice.
Depending on the type of loan you apply for, you’ll then have to submit any requisite information, like proof of time in business, earnings, and identifying information or taxes. Once approved, you should receive your money quickly.
What you’ll need to apply
What you need to apply for financing through the Lendio marketplace varies depending on what kind of loan you want. But in general, be prepared to provide:
- Personal identification, such as a government-issued ID.
- Your Social Security number.
- Taxes for the past three to five years.
- Proof of business name, incorporation, certification, licensing, etc.
- Profit and loss statements.
- Evidence of experience in your industry.
- Bank account statements for the past three years.
When shopping for small business financing, compare options from at least three lenders to find the best deal. Lendio is just one place to do that. You can also check out our list of the best small business loans to start your search right here on LendEDU.
If you’re confident you can keep up with monthly payments and avoid accruing interest, you could also put smaller business expenses on a business credit card.
This could give you more flexibility than a loan, but will likely come with higher interest rates and potential fees, so you should avoid charging more than you can afford to quickly pay off.
How we rate small business loans
We rate small business loans on the weighted average of 8 data points:
- BBB Rating/Trustpilot Rating/Customer Support Availability (15%)
- Fees (15%)
- Loan Terms (15%)
- Loan Amounts 15%)
- Minimum Required Credit Score (10%)
- Minimum Required Business Age (10%)
- APRs (10%)
- Deposit Time (10%)
Author: Carrie Ott