Pros and Cons of Kabbage, Fundbox and Blue Vine Short-Term Lines of Credit
If you decided to apply for a line of credit from any of the aforementioned lenders, here’s a quick look at each or their pros and cons.
- Pro: Applicants only need a minimum credit score of 560
- Con: Kabbage is more expensive than other options
- Pro: Fundbox does not require a minimum credit score
- Con: Repayment terms are limited to 3 months
- Pro: Applicants only need to have been in business for 6 months
- Con: Requires a higher level of income than other lenders
For Businesses With Annual Revenue Under $100k
If your business is still in its early stages, some lenders might be hesitant to let you borrow money. The below lenders, however, have more relaxed requirements when it comes to business revenue.
- Fundbox: Minimum revenue requirement is $25,000 per year
- Kabbage: Minimum revenue requirement is $50,000 per year
- StreetShares: Minimum revenue requirement is $75,000 per year
- LendingClub: Minimum revenue requirement is $75,000 per year
Short-Term Loans for Businesses Less Than 1 Year Old
If it’s your businesses age — not it’s revenue — that seems to be a stumbling block with some lenders, you still have options. In order to qualify for a loan from either BlueVine or Fundbox, you simply need to prove your business has existed for at least 6 months.
Short-Term Business Loans for Credit Scores Under 600
If your credit score isn’t anything to brag about, that won’t necessarily preclude you from qualifying for a short-term business loan from Kabbage, Fundbox, or OnDeck.
- Kabbage considers several other factors in addition to an applicant’s credit score
- Fundbox looks at a business’s finances rather than the credit history of the business owner
- OnDeck only requires a credit score of 500 to get approved
Short-Term Business Loans
If you need fast cash, here are four of the most popular lenders to choose from along with a quick look at their pros and cons.
- Pros: High borrowing amounts, fast funding
- Cons: Expensive financing, frequent repayments
- Pros: Only requires $25,000 annual income, no prepayment penalties
- Cons: Funding maxes out at $150,000
- Pros: Loans up to $250,000, only requires a credit score of 550
- Cons: Requires an annual revenue of at least $200,000
- Pros: Lower interest rates than many other lenders, repayment terms up to 4 years
- Cons: Requires a credit score of at least 620 and annual revenue of at least $100,000
For Low-Interest Rates
If qualifying for a loan isn’t an issue for you, and you’re simply seeking the lowest interest rates around, a good place to start looking is Credibility Capital. You’ll need to have a high credit score to get approved by Credibility, but for qualified applicants, APRs can be as low as 10%.
Pros and Cons of Short-Term Business Loans
Still on the fence about whether a short-term business loan can solve your problems? Here’s a quick look at the pros and cons.
- Pros: Fixed repayment structure, easy to apply, funding available as soon as the same day
- Cons: More expensive than long-term loans, some loans require rapid repayment
When to Avoid Short-Term Business Loans
Short-term loans can be a saving grace for businesses in dire circumstances, but that doesn’t mean choosing one is always the right thing to do. If you encounter any of the following red flags during your search for a short-term business loan, we recommend looking elsewhere for a financial institution that can meet your needs.
- Exorbitant fees or interest rates that are unreasonably high
- A requirement for more frequent repayments than other lenders ask for
- Unpredictable repayment amounts that fluctuate throughout the life of the loan
- Confusing terms that you can’t make heads or tails of
Now that you have a better understanding of how your company can qualify for a short-term business loan, take the time to compare your options before selecting the best lender for you.