Noticing differences between these online lenders lets you contrast financing options, at a glance. Annual interest rates and maximum loan amounts vary between the six online lenders featured here, as well as their requirements: you’ll notice that Camino Financial requirements tend to be more flexible. What drives us to adapt to different circumstances is our company’s motto, “No Business Left Behind”. When choosing the right online lender for you, it’s important to note dissimilarities among features to make better funding choices.
What Makes Business Online Lenders Different and Attractive?
- By using the latest technology and algorithms, online lenders can analyze credit and cash flow to determine eligibility quicker (often in under an hour).
- Whereas traditional banks tend to have strict underwriting requirements, online lenders approve business loans that traditional banks overlook.
- Online lenders speed up the application process by using nontraditional metrics like social media synergies and online customer evaluations to access your business. As a result, borrowers have quicker and easier access to capital than traditional lenders typically provide.
- Here’s one caveat to consider when using an online lender: Borrowing costs are typically higher for business loans acquired online as compared to most bank loans.
Common Features in Most Online Lenders
When researching alternative lending, you will notice that the general features below vary per lender.
- Rates and fees: Online business loans usually have an origination fee and a higher interest rate because they mainly acquire funds from investors or credit institutions, and also because they don’t require collateral they can seize if the borrower fails to pay off the loan.
- Qualifications: Lenders prefer that your business hasn’t had a bankruptcy in the last 12 months, you’re current with creditors, and you aren’t maxing out your other credit sources.
- Time in business: For the most part, online lenders will work with entrepreneurs who have been in business for a few months or more than a year.
- Annual Sales: Consistent sales are what online lenders look for. In fact, some lenders view revenue more important than a credit score.
- Credit score: Online lenders are willing to work with borrowers that have lower credit scores. In the case of Camino Financial, credit history is not required. Additionally and as we mentioned, many don’t require collateral such as equipment, vehicles, or land.
- Industry: Online lenders choose which industries they prefer to exclude for being considered too risky. Examples include gambling, oil wildcatting, real estate development, mortgage servicing, and others.
Types of Funding Online Lenders Can Provide
- Long-Term Loans. Most business owners running an established business have stronger credit scores and can qualify for longer-term loans to make long-term investments.
- Short-Term Loans and Microloans. When an opportunity comes along you can’t pass up, these types of short-term loans are better suited for one-time business investments.
- Business Lines of Credit. Entrepreneurs who need quick access to working capital use this type of funding like a revolving line of credit that’s continually repaid. You can make purchases, cover payroll, or improve cash flow.
- Equipment Financing. When you need to finance equipment, this is your best funding option whether you need to purchase a new air compressor for your auto repair shop or equipment for your construction business.
- Invoice Financing. If your accounts receivables mount up and remain unpaid, you can use a third-party online lender to get cash.
- Merchant Cash Advances. Business owners that have poor credit can receive cash advances based on a percentage of credit card sales. This short-term funding arrangement helps you get cash quickly and is an attractive funding option because collateral isn’t required.
Popular Business Online Lenders Compared To Camino Financial
|FEATURES||Camino Financial||Lending Club||OnDeck||Kabbage||One Park Financial||SmartBiz|
|Types of financing offered||Microloans and business loans||Business loans||Business loans and lines of credit||Business lines of credit||Business loans||Business loans|
|Processing Duration||2-4 days microloans,
3-10 days small business loans
|7 days on average||1-3 days||1-3 days after approval||In as little as 3 days||7 days on average|
|Repayment Terms||18 – 24 months microloans
24 – 60 months small business loans
|1-5 year terms||3-36 months||6-18 months||6-12 months||Up to 10 years|
|Requirements||$30,000 in annual gross sales, at least 9 months in business||$50,000 annual sales and 12 months in business||$100,000 annual sales and 12+ months in business||$50,000 annual sales and 12+ months in business||$30,000 annual sales and 3+ months in business||$50,000 annual sales and 2+ years in business|
|Max. Loan Amount||$75K – microloans
$400K – small business loans
|$500K||$100K – lines of credit (microloans not offered)
$500K – small business loans
|Annual Interest Rate Range (APR)
|19% to 34% microloans,
12% to 24.75%
small business loans
|9.77% – 35.98%||9.99% – 48.7%||18% – 120% (6-12 month loans)
15% – 39% (18-month loans)
|Varies per borrower, rates not advertised||Fixed interest rate from 6.99% to 26.99%|
|Collateral Required?||No||Yes, for loans over $100,000||No||No||No||Required depending on the size of the loan|
|Type of Customer Service||
1 on 1 (Spanish and English) consults by phone, SMS, instant chat or email
|By phone||By phone and email||By phone, email, or online||By phone and text messaging||By phone and email|
Types of financing offered
Lenders like the ones above offer a variety of financial products to accommodate your business needs. At some point, your business may need a line of credit, microloan, a small business loan, or all three.
When entrepreneurs decide to get money for their businesses, they want to move forward quickly. It’s important to them to get funding in days, not weeks.
Your loan’s term affects the amount of your monthly payment and how much interest you pay. Longer term loans mean you pay more interest while shorter terms increase your monthly payment.
This is one of the most important features to consider. Some businesses don’t qualify for a loan because they don’t meet the minimum requirements set forth by lenders. Besides the basic requirements offered in the table above, have also in mind the following:
- Lending Club: applicant must own at least 20% of the business and have at least fair or better personal credit, no recent bankruptcies or tax liens.
- OnDeck: minimum credit score of 600, a minimum of 5 deposits to your business checking account per month.
- Kabbage: a periodic review of credit lines and pricing to include line and pricing reductions, increases, or eliminations.
- OnePark Financial: minimum credit score of 450, not involved in an open bankruptcy case.
- SmartBiz: credit score must be above 650, the business must be owned by a U.S. citizen or lawful permanent resident 21 years old, no outstanding tax liens, no bankruptcies or foreclosures in the past 3 years, no recent charge offs or settlements, current on government-related loans.
- Camino Financial: Business must be located in the U.S. except for New Jersey, North Carolina, Hawaii, and Puerto Rico. The Applicant must have at least a tax identification number (ITIN) and own at least 50% of the business. The company does not directly fund start-ups or individuals but works with a trusted partner, Aura, to offer personal loans in CA, TX, AR and IL.
Maximum loan amount
As you can see from the above table, funding amounts range from $75,000 to $750,000. It’s easy to narrow down which lender matches your business’s specific financial requirements.
Annual Interest Rate
Qualifying for the lowest interest rate to repay a loan can save you hundreds and thousands of dollars over the life of the loan. That’s why it’s vitally important to comparison shop the annual interest rates charged by lenders.
Some lenders may require you to put up collateral in the form of personal or business assets. While this can increase your chances of approval, bear in mind that if you fail to pay off your loan, your assets could be seized by the lender.
Type of customer service
When you have a question before or after getting a loan, you want to reach customer service as soon as possible. Lenders that are easier to reach means you get answers quicker.
Why Is Camino Financial Your Best Option?
Have you noticed that Camino Financial has competitive features built into their loans? That means we offer a more flexible lending arrangement to satisfy your business needs. In addition to the features listed in the above table, Camino Financial offers these exclusive benefits:
- Ongoing education (available in English and Spanish) to improve your business’s financial performance as well as a free weekly newsletter to help businesses grow
- Camino Financial works with borrowers who only have an ITIN (Individual Taxpayer Identification Number) when they haven’t qualified for a Social Security Number
- Opportunity for existing borrowers to graduate to a better loan (larger amount and lower interest rate) after 9 months of timely payments
- No need for collateral to secure your loan
- Limited restrictions on fund usage
- No credit history required
- Customer service loan experts are bilingual (English and Spanish), a huge plus for Latino entrepreneurs. Camino Financial establishes long-term partnerships with its members.
- Member-discounted pricing for services like commercial insurance, legal services, tax preparation, bookkeeping, and website development
This article, “How Do Camino Financial Loans Work“, will answer any additional questions you may have. Plus, the success stories from Camino Financial members who turned to our financing to grow their businesses will provide you with the reassurance and peace of mind you need to start your loan application process.
If you’re ready to take your business to the next level, why not fill out an application today and find out for yourself the benefits of getting a loan with Camino Financial. This won’t impact your credit and you will instantly know if you pre-qualify to obtain one of our loans. Shortly thereafter, a Camino Financial loan specialist will contact you to guide you through the process and guarantee your success.