Finding The Right Business Loan - A Lendio Review

Lendio is an online marketplace for business loans. Customers shop and compare offers across a range of loan products from various lenders.

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    Financially Reviewed by Thomas J. Brock

    Lendio is a business financing platform that acts as a one-stop shop for financing. Unlike other online lending companies, Lendio acts as a broker, connecting applicants with various lenders and products. Its network includes big names such as BlueVine, OnDeck, Kabbage, and Amex, to name a few.

    Since its inception, Lendio boasts over 216,000 small business loans and $10+ billion funded. The company’s network includes 75+ lenders, with partners including PayPal, Bank of America, Kabbage, and LendingClub, to name a few.

    What Is Lendio?

    Founded by Brock Blake in 2011, Lendio connects loan applicants with lenders across a wide range of products. These include short-term options such as term loans, lines of credit, and long-term options such as commercial mortgages.

    Using their online dashboard, customers can apply for loans in about 15 minutes. Once approved, you can access your funding in as little as 24 hours.

    Lendio doesn’t stop at just financing. The company will help you to connect your small business with credit repair, bookkeeping services, and legal assistance.

    Lendio provides direct customer service to answer your questions and help walk you through the application process for customers not sure about what loans or financial products work best for them.

    Lendio

    Advantages And Disadvantages Of Lendio

    Lendio has some unique advantages in acting as an online lending marketplace.

     Advantages

    • Free registration – You can register for an account with Lendio for free and apply and browse offers.
    • Easy to apply –  Using the online dashboard, you fill out basic profile information and answer questions through multiple choice prompts. The entire process takes around 15 minutes.
    • Product & lender choice – As a lender marketplace, Lendio provides access to numerous financial loan products across more than 75 lenders, letting you pick the product best suited to your needs.
    • Competitive offers – Some applicants will receive multiple offers for their request. This lets you compare and choose the best offer based on rate, loan size, or other factors.
    • Loan and payment calculator – Lendio’s website offers a dynamic loan calculator that allows you to change different variables to see how it might impact loan payments.

     Disadvantages

    • Fees are not uniform – Because Lendio deals with multiple lenders, it can be difficult to compare fees between offers, especially some of the less common ones such as origination fees, late fees, and maintenance fees. In some cases, lenders may include prepayment penalties.
    • Qualifications are not uniform – Similar to the issues with inconsistent fees, qualifications amongst lenders aren’t always the same, even on similar products. This can make it difficult to find the right option for your business.

    Lendio Loan Features

    As a marketplace that connects applications with loan providers, Lendio financial products include each of the following:

    Business Line of Credit

    Lines of credit act like credit cards, providing customers with a preset borrowing limit that can be used at any time. Borrowers can take out as little or as much as they need up to the credit limit. You are charged interest on the outstanding balance. As you repay the loan, you increase the amount of available credit for you to borrow against.

    Loan Type

    Line of credit

    Term Length

    1-2 years

    Repayment Period

    Weekly or monthly

    Apr Range

    8.00%-24.00%

    Min-max Amount

    Up to $500,000

    Short Term Loan

    Short term loans are lump sum loans with short repayment periods, typically 1-3 years. Customers borrow a set amount, paying interest on the initial loan’s size even as you pay down the balance.

    Loan Type

    Term loan

    Term Length

    1-3 Years

    Repayment Period

    Monthly

    Apr Range

    As low as 8.00%

    Min-max Amount

    $2,500-$500,000

    Merchant Cash Advance

    Merchant cash advances allow small businesses to borrow against future earnings. Collateral is not typically required, and funds can be made available in as little as 24 hours.

    Loan Type

    Merchant cash advance

    Term Length

    Up to 2 years

    Repayment Period

    Daily percentage of credit card sales or percentage of total daily business sales

    Apr Range

    As low as 18%

    Min-max Amount

    $5,000-$200,000

    SBA Loans

    SBA loans are government backed loans and one of the more popular options for small businesses. These loans include Paycheck Protection Program (PPP) loans and SBA 7(a), 504, and SBA Express loans.

    SBA loans are term loans that extend over longer periods. Borrowers receive one lump sum, paying back the loan over 10+ years.

    Loan Type

    Term loan

    Term Length

    10-30 Years

    Repayment Period

    Monthly (PPP loans may have deferred payments & loan forgiveness)

    Apr Range

    Prime+ (estimated between 5.50% - 8.00%)

    Min-max Amount

    Up to $5,000,000

    Equipment Financing Loan

    Equipment financing loans are term loans used to purchase capital goods and equipment. These loans extend a few years in duration and use the purchased equipment as collateral.

    Loan Type

    Term Loan

    Term Length

    1-5 Years

    Repayment Period

    Monthly

    Apr Range

    As low as 7.5%

    Min-max Amount

    $5,000-5,000,000

    Business Acquisition Loan

    When you want to acquire another company, business acquisition loans can help. These loans let you purchase an existing company rather than starting one from the ground up. Business acquisition loans are designed to be paid back over multiple years, similar to a mortgage.

    Loan Type

    Term loan

    Term Length

    10-25 years

    Repayment Period

    Monthly

    Apr Range

    As low as 5.5%

    Min-max Amount

    $5,000-5,000,000

    Accounts Receivable Financing

    When you need funds more quickly than customers pay, accounts receivable financing can help. Accounts receivable financing (also known as factoring) pays you a portion of a customer’s outstanding invoice immediately. Once the customer pays, you receive the rest of the money less any fees.

    Loan Type

    Invoice factoring

    Term Length

    Up to 1 Year

    Repayment Period

    Weekly

    Apr Range

    As low as 2%

    Min-max Amount

    Up to 90% of receivables

    Business Credit Card

    One of the more well-known products, business credit cards act as a line of credit that you can draw on for business purchases. While some cards do allow for cash advances, those typically come with a higher rate.

    Loan Type

    Line of credit

    Term Length

    Up to 1 year

    Repayment Period

    Monthly

    Apr Range

    8%-24%

    Min-max Amount

    Varies by Lender

    Commercial Mortgage

    When you need to buy real estate for your business or upgrade to your current property, commercial mortgages provide you with one time funding for the purchase.

    Loan Type

    Term loan

    Term Length

    20-25 years

    Repayment Period

    Monthly

    Apr Range

    4.25-6.00%

    Min-max Amount

    $250,000-$5,000,000

    Startup Loan

    Startup loans help small businesses get off the ground. They help newer companies obtain funds without giving away equity to investors or borrowing from family or friends.

    Loan Type

    Term Loan

    Term Length

    Up to 25 years

    Repayment Period

    Monthly

    Apr Range

    As little as 0.00-17.00%

    Min-max Amount

    $500-$750,000

    Business Term Loan

    Business term loans are one of the most common small business loans. These provide one lump sum up front that is paid back over a set number of years.

    Loan Type

    Term loan

    Term Length

    1-5 Years

    Repayment Period

    Monthly

    Apr Range

    As low as 6.00%

    Min-max Amount

    $5,000-2,000,000

    Lendio Interest Rates And Fees

    Because Lendio acts as a marketplace for loans, fees, qualifications, and requirements are not uniform. For all products listed below, except for SBA loans and others noted below, origination, prepayment, late payment, and maintenance fees may vary by lender.

    Loan Type

    Fees

    Interest Rates

    Invoice Factoring

    Varies Per Lender

    8-24%

    Term Loans

    Varies Per Lender

    8-13%

    Merchant Cash Advance

    Varies Per Lender

    Starts at 18%

    SBA Loans

    Varies Per Lender

    5.50-8%

    Equipment Financing

    Varies Per Lender

    Starts at 7.5%

    Business Acquisition

    Varies Per Lender

    Starts at 5.5%

    Accounts Receivable

    Varies Per Lender

    Starts at 2%

    Line of Credit

    Varies Per Lender

    8-24%

    Commercial Mortgage

    Varies Per Lender

    4.25-6%

    Startup Loan

    Varies Per Lender

    Up to 17%

    Business Term Loan

    Varies Per Lender

    Starting from 6%

    How To Qualify For A Lendio Loan

     Since Lendio acts as a lender marketplace, the qualifications vary between products and lenders.

     However, there are some general guidelines to work with:

    • The business should be operational for at least six months.
    • You should have a personal credit score of 550 at least.
    • Your business should generate at least $10,000 in monthly revenue.

    How to Qualify for Lendio Business Line of Credit 

    Criteria

    Less than $100,000 loans

    More than $100,000 loans

    Minimum Credit Score

    560

    560

    Minimum Annual Revenue

    $50,000

    $50,000

    Minimum Time In Business

    6 months

    6 months

    How to Qualify for Lendio Equipment Financing Loan

    Criteria

    Less than $100,000 Loans

    More than $100,000 Loans

    Minimum Credit Score

    650

    650

    Minimum Annual Revenue

    $50,000

    $50,000

    Minimum Time In Business

    12 Months

    12 Months

    How to Qualify for Lendio Business Credit Card

    Criteria

    Less than $100,000 Loans

    More than $100,000 Loans

    Minimum Credit Score

    680

    680

    Minimum Annual Revenue

    Varies by Lender

    Varies by Lender

    Minimum Time In Business

    Long Enough to Establish Credit History

    Long Enough to Establish Credit History

    How to Qualify for Lendio Startup Loan

    Criteria

    Less than $100,000 Loans

    More than $100,000 Loans

    Minimum Credit Score

    680

    680

    Minimum Annual Revenue

    Varies by Lender

    Varies by Lender

    Minimum Time In Business

    6 Months

    6 Months

    The Lendio Loan Application Process

     Lendio’s application process takes about 15-minutes regardless of the type of loan you apply for.

    From their website, you’ll start by filling out basic information such as:

    • The requested loan amount
    • Credit score range
    • Business start date
    • Average revenue over the last 3 months
    • Type of business
    • Purpose of the loan
    • Your percentage of ownership
    • State you do business in
    • Annual profits
    • Entity type
    • Annual personal income

    You’ll also need to provide basic information about yourself and your business, such as date and names or DBA.

    From there, Lendio will run a soft pull on your credit report, which does not affect your score.

    Their system then shops around for offers to present to you within about 72 hours. Once you’re approved, you can receive funds in as little as 24 hours, depending on the type of loan you choose.

    Lendio also provides dedicated personnel to help you through the process should you need them.

    How Does Lendio Determine The Loan Amount?

    Because Lendio acts as an intermediary to match you with lenders, they do not determine a specific loan amount. The individual lenders determine the credit limits or loan amounts. You will be able to review the terms of each offer, including credit limits and loan amounts, before accepting them.

    In general, most lenders look at one or more of the following factors to determine the loan amount:

    • Personal credit score
    • Years in business
    • Annual revenues (or monthly if in business less than one year)
    • Purpose of the loan
    • Type of loan requested

    Lendio Customer Support

    Lendio offers multi-channel support, including phone, email, and social media on Facebook, Twitter, Instagram, and LinkedIn.

    To help you through the loan process, Lendio assigns a personal funding manager to you when you apply. They’ll help walk you through the various loan options and choose the one that’s right for you.

    You can browse their resources and blog on their website, which includes articles that cover various small business topics of interest. Their FAQ page covers three main categories: types of loans, qualifying and applying, and small business basics.

    Lendio Loan Reviews

    Although Lendio is not rated by the Better Business Bureau, the company has more than 12,500 on Trustpilot with a rating of 4.7 out of 5 stars.

    The majority of positive reviews highlight the excellent customer service and holistic experience provided by Lendio. Several highlight the help provided by the funding manager in guiding them through the process.

    Of the reviews listed on Trustpilot, the majority of complaints center around PPP applications which will no longer be accepted after May of 2021.

    Merchant Maverik’s review gives Lendio 5 out of 5 stars. They highlight the low qualification requirements, customer service excellence, high borrowing amounts, and easy application process.

    Of the two cons listed, expensive rates and funds taking a while to disperse, they don’t provide much evidence to support these claims.

    Positive Reviews

    Negative Reviews

    Customer support and service

    Delayed fund disbursement

    User-friendly website

    Expensive rates

    Various types Of funding

    PPP Loan difficulties

    Final Thoughts

    Lendio fills a unique niche in the financial lending space. With the number of lenders available online, going through individual applications can be a time consuming ordeal. Providing access to multiple lenders and products allows customers to select the solution best suited for their situation.

    What further sets them apart is the unique experience they provide for customers through their funding managers. These individuals act as a concierge to the customer, helping them assess their needs and find the products to match.