2021 Full Guide: Getting Online Business Loans
Written by: Andres Fernandez
December 14, 2020
The Beginning of Online Business Loans
Online business loans are like any other kind of loans that is not directed to a traditional bank. It started to become popular is 2006, when LendingClub realized it could make loans available online, then sell those loans to Investors or lenders for a fee.
LendingClub started using the internet to find lenders that are looking for loan applications. These applications mostly consisted of small business not being able to attain a loan from a bank. Now, many successful businesses go through online lending due to fast approvals and simpler funding requirements.
Historically, the term, online lending, has been used from credit unions, government loans and other credit that resembles to bank loans but comes from a different source.
How to Find Safe Online Lenders
In this day in age, the internet provides remarkable tools to apply for online business loans: free rate checks, inquiries and loan calculators that enables some quick research. Before applying for an online business loan, it is important to research multiple lenders. There are lenders that do not have your business in their best interest, due to the fact they are looking for a quick payout.
It is harmful to shop around and apply to multiple lenders at the same time. Research before applying.
Look for a physical address. Just because they are an online lender, it does not take away the legitimacy of the business. Legitimate lenders often display their physical address on their website in a prominent location. For example, you can visit any page on our website and see our physical address on the top header of the website.
Look for business reviews on Google. It is important to know reviews can not be the only reason to inform your opinion. For one, many customers tend to leave a negative review when they were dissatisfied, but satisfied customers tend to move along when their expectations have been met. This is an important research but keep in mind do not base your decision entirely off of reviews.
This our Google business page showing reviews, our services, and our operating hours.
Key Characteristics
Online business loans offer a number of advantages over traditional small business loans.
Access to Faster Capital
Since online lending is quicker than your traditional bank lending, the process typically is very automated which comes in handy for small business owners’ busy schedule. As all business owners, time is of the essence — taking advantage of opportunities that
Your Performance Requirements
Lending platforms like Capitalize Loans evaluate the overall performance of the business when reviewing an application, unlike traditional lenders often look at the creditworthiness history of the business owner, number of employees and industry trends. Capitalize Loans look for six months of business operations, 3 months of bank statements, and a simple business applications where credit is not pulled or assessed.
Flexibility
Online lenders such as Capitalize Loans offer lines of credit which businesses can draw multiple times up to the total line amount. These loan products offer great flexibility since you can take the amount you need without having to reapply each time. Online business loans gives you the ability to choose how much you want to borrow.
A line of credit isn’t new, and its very common for business owners. On the other hand, applying, getting approved, and receiving the money within 24 to 48 hours is something a traditional loan can not compete with.
Unexpected Problems
When it comes to running a business, owners tend to confront a series of risks. These risks can threaten the company which could reduce revenue or increase costs. Very so often, managing these unexpected risks determines their success and their longevity. No matter how well you plan, surprises come up from time to time that can leave you strapped for capital.
Heading over to an online business loan lender, applying for a line of credit gives you the peace of mind that you are able to handle whatever comes next.
Improves Your Creditworthiness
Traditional lenders want to see proof that the company is able to manage debt well. If a business never borrows money, it’s hard to establish a business as a good credit risk. Plus, providing additional capital, a business’ first loan can help demonstrate that the business can handle and manage loans.
Once establishing good credit history, including having prompt payments and managing credit well, you’ll become a more attractive customer for all kinds of lenders. So when you can demonstrate handling loans well, your cost of borrowing goes down.
How To Get Online Business Loans
A great reason why online business loans is becoming easier is because of our easy-to-understand application. The application can be completed online, over the phone, or even via fax.
Capitalize uses technology to evaluate the application, going through an algorithm to have your application processed and approved by lenders. Capitalize Loans does not require all of the documentation that the traditional bank will. There are certain documents that are needed to ensure your application is complete and ready to get your funded. These are the documents you should have at your fingertips when completing your application, including: Your Social Security Number
- Your Business Tax ID
- Quick access to your bank account, or paper bank statements.
- Previous 3 month bank statements
Business Term Loan
Online lenders offer term loans of up to $500,000. For a short-term loan, the repayment period typically ranges from six to 12 months, while a long-term loan repayment can extend up to 10 years or longer in some cases. Business owners can also find financing that can be used for specific items, like equipment or inventory.
Invoice Financing
Invoice Factoring turns business owners’ unpaid invoices into immediate cash. You sell the invoices to a factoring company, which paid when it collects from your customers. If you prefer to maintain control over your invoices, invoice factoring is an alternative to factoring. Capitalize finances up to $500,000, for good managing cash flow, and short-term financing.
Why Capitalize?
Flexible Funding
You make decision when and how much you want to use your funds. As long as you have funds available, you can withdraw at anytime.
Fast Access
Withdraw from your line of credit whenever you want, as long there are funds available. You'll have the security to use whatever you need, wherever you are.
Trusted by Thousands
Capitalize customers have securely been funded over $3,000,000 directly to their bank account. Our application form, is highly secured so no information is hacked.
Flexible Terms
Capitalize Loans™ loans have simple terms ranging from daily, weekly, and monthly. No upfront fees or prepayment penalties. We provide you with a payment schedule before taking a loan so there won't be any surprises.
Simple Process
Securely link your last 3 month of bank statements to automatically get reviewed. This allows underwriters to evaluate your business right away and get approved fast.
Personal Service
Our team of experts are here to help when you need it, around the clock. We offer many ways to get in contact with us: phone call, email, text, and chat box is the fastest way to get ahold of us.