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Funding Circle is a commercial lender that works by connecting small business owners with investors lending money. In this in-depth review, we'll cover what it takes to land a Funding Circle small business loan and help you determine whether Funding Circle is the right lending source for you.
Funding Circle pairs businesses that have been in business for at least two years with individual investors for term loans, lines of credit, and SBA loans. Eligible business must have at least fair credit, with a minimum accepted credit score of 660.
Competitive rates for highly qualified borrowers
Funding in as little as two business days
Costly origination fees
Businesses must be in operation for a minimum of two years
Requires a lien on business
Minimum credit score may be higher than some competitors
Compare the best personal loans
Get the best rates and terms to fit your needs. Here are a few loans we'd like to highlight, including our award winners.
4.0/5
Our ratings are based on a 5 star scale.
5 stars equals Best.
4 stars equals Excellent.
3 stars equals Good.
2 stars equals Fair.
1 star equals Poor.
We want your money to work harder for you. Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs. = Best = Excellent = Good = Fair = Poor
4.5/5
Our ratings are based on a 5 star scale.
5 stars equals Best.
4 stars equals Excellent.
3 stars equals Good.
2 stars equals Fair.
1 star equals Poor.
We want your money to work harder for you. Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs. = Best = Excellent = Good = Fair = Poor
4.0/5
Our ratings are based on a 5 star scale.
5 stars equals Best.
4 stars equals Excellent.
3 stars equals Good.
2 stars equals Fair.
1 star equals Poor.
We want your money to work harder for you. Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs. = Best = Excellent = Good = Fair = Poor
This business loan is a good fit for: Businesses with strong credit and two or more years in operation.
Top perks
Competitive rates: Although only the most highly qualified borrowers will qualify for an interest rate as low as 7.9%, that's still competitive, especially in today's market. Paying lower interest rates leaves business owners with more money to spend on growing their operations.
Fast funding: How quickly a business will receive its loan depends on several factors, including how simple its loan application is and the type of loan it seeks. However, some businesses receive funds in as little as two days, which can help when an immediate financial need requires attention.
What could be improved
Expensive origination fees: It's impossible to overlook how much origination fees can cost the average borrower. With fees ranging from 4.49% to 10.49%, that means borrowing $100,000 will cost the business between $4,490 and $10,490.
Businesses must be in operation for two years: The requirement that a business must be in business for two years means that startups and newer businesses are unable to land a loan when they may need it most. While it's understandable that lenders may not want to take the risk, it's still a drawback for new entrepreneurs.
Types of business loans offered by Funding Circle
Funding Circle focuses on connecting small business with investors for three specific types of business loans:
Term loans: Deposited into a business bank account via a lump sum from a lender and paid off in fixed installments. Repayment periods vary from six months to seven years. Typically secured by a lien on business assets and may require a personal guarantee. The interest rate may be fixed or variable and depends on creditworthiness and the loan term selected.
Line of credit: A flexible form of short-term financing that gives borrowers access to a set amount of credit when needed. Payments are not due until the funds are drawn. Business owners may be eligible for up to $250,000. Fees associated with a line of credit can include a monthly maintenance fee, draw fees, and late payment fees.
SBA loans: As an official Small Business Administration (SBA) lending partner, Funding Circle helps small business owners apply for SBA 7(a) loans up to $5 million, depending on the loan subtype. The SBA typically requires a personal guarantee from all parties with a 20% or higher stake in the business.
How to qualify for a Funding Circle loan
To be eligible for a Funding Circle loan, a business must:
Be in business for two or more years
Earn $50,000 or more in annual revenue
Possess a strong personal and business credit score of at least 660
Have no bankruptcies in the last seven years
Application process and required documentation
Funding Circle's streamlined application process is easy to follow. It consists of the following steps:
Fill out an online application
Upload required documents
Speak with a dedicated account manager
Wait for approval
Once approval is granted, expect funding within as little as 48 hours
Business owners may enjoy a smoother application process by having the following documents ready:
Minimum of two years worth of business tax returns
One year of personal tax return
Last six months of business bank statements
List of current business debts
Guarantor form
Additional documentation, as requested by underwriting
This Funding Circle small business loan is right for you if:
Funding Circle may be a good fit for a business that:
No, not directly. Funding Circle helps match businesses with individual lenders who have money to loan.
The lowest rates are reserved for the most highly qualified borrowers. Borrowers with an excellent credit score and healthy business revenue have the best chance of landing a low rate.
There are a couple of options. You can find a lender willing to work with business owners with bankruptcy on their record, or wait two years and apply through Funding Circle.
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We're firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers. The Ascent, a Motley Fool service, does not cover all offers on the market. The Ascent has a dedicated team of editors and analysts focused on personal finance, and they follow the same set of publishing standards and editorial integrity while maintaining professional separation from the analysts and editors on other Motley Fool brands.
We're firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers. The Ascent, a Motley Fool service, does not cover all offers on the market. The Ascent has a dedicated team of editors and analysts focused on personal finance, and they follow the same set of publishing standards and editorial integrity while maintaining professional separation from the analysts and editors on other Motley Fool brands.
Citi Personal Loan disclaimer: **Rates as of05-31-2024. Your APR may be as low as11.49%or as high as 20.49% for the term of your loan. The lowest rate quoted assumes excellent credit and a loan term of 24 or 36 months. Your APR will depend on a variety of factors including your creditworthiness, term of loan, and existing relationship with Citi. For example, if you borrow $10,000 for 36 months at 15.99% APR, to repay your loan you will have to make 36 monthly payments of approximately $351.52.
There is a 0.5% APR discount if you enroll in automatic payments at loan origination. Additionally, existing Citigold and Citi Priority customers will receive a 0.25% discount to the interest rate. If you are in default, your APR may increase by 2.00%. No down payment is required. Rates subject to change without notice.
You must be at least 18 years of age (21 years of age in Puerto Rico). Co-applicants are not permitted. Loan proceeds cannot be used for post-secondary educational or business purposes.
If you apply online, you must agree to receive the loan note and all other account disclosures provided at loan origination in an electronic format and provide your signature electronically.
Credit cards issued by Citibank, N.A. or its affiliates, as well as Checking Plus and Ready Credit accounts, are not eligible for debt consolidation, and Citibank will not issue payoff checks for these accounts. If you are unsure of the issuer on the account, please visit https://www.citi.com/affiliatesproducts for a list of Citi products and affiliates.
The full range of available rates varies by state. The average 3-year loan offered across all lenders using the Upstart platform will have an APR of 21.97% and 36 monthly payments of $35 per $1,000 borrowed. For example, the total cost of a $10,000 loan would be $12,646 including a $626 origination fee. APR is calculated based on 3-year rates offered in the last 1 month. There is no down payment and no prepayment penalty. Your APR will be determined based on your credit, income, and certain other information provided in your loan application.
The Ascent is a Motley Fool service that rates and reviews essential products for your everyday money matters.
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