If you’re familiar with Larry King, you may have recently noticed him in a commercial for LendVantage, an online company that claims to help businesses obtain up to $250K in financing in just minutes. In fact, LendVantage claims that their lending partners have funded more than $5.3 billion for businesses just like yours since opening their doors in 2007.
But does LendVantage really provide an advantage for your business? Most importantly, is it worth your time, and are their loans worth your hard-earned money? We did some digging around, and here’s what we found out.
How LendVantage Works
According to the LendVantage website, they can help you obtain anywhere from $5K to $250K of business capital in minutes using their “top” network of lending partners. With a self-proclaimed goal of helping to make your business stronger, the company claims that they can help you obtain this money without a lengthy application process, and without the need for personal collateral. In fact, LendVantage claims that their lenders may be able to provide you with capital if you’ve already been turned down by a bank, have a tax lien or a discharged bankruptcy, or even if you don’t have a business plan.
However, in order to obtain a loan from one of LendVantage’s lenders, you’ll need to have been in business for at least 3 months, consistently be earning at least $10K in monthly revenue, and have a 500+ personal credit score.
With this in mind, LendVantage claims the funding process occurs over 3 steps:
- Complete the online or phone-based application in minutes. During this phase, you’ll need to provide at least 4 months of business account bank statements.
- After LendVantage evaluates your business’s health and specific needs, you’ll then be connected with one of LendVantage’s lenders who can best help.
- After completing the application process with a specific lender, you may be able to receive your money within 24 hours of approval, and to use these funds in any manner you see fit.
Regardless of which LendVantage lender you go through though, you’ll be presented with one of three different loan options:
- Business Term Loan – Loan amounts available anywhere from $5K to $250K, which will be repaid over the course of between 4 and 24 months. You’ll repay a fixed amount per day or per week, depending on your business’s financial strength and revenue stream.
- Revenue-Based Financing – Loan amounts available anywhere from $5K to $250K, which will be repaid over the course of between 4 and 18 months. Repayment amounts are withdrawn every day M-F, but may be adjusted every 2 weeks depending on your revenue.
- Merchant Cash Advance – Loan amounts available anywhere from $5K to $100K. While there are no set terms for this type of loan, they’re typically repaid at 8-10% of your daily credit card sales over the course of 6-8 months.
LendVantage Pricing & Refund Policy
LendVantage’s services are completely free, and come without obligation
Unlike traditional loans though, none of LendVantage’s lenders subject you to annualized interest rates. Instead, you’ll pay a fixed cost associated with each loan you take out. And while there are numerous factors that can affect this cost, it typically ranges between $0.17 and $0.40 per $1 financed. In other words, if you take out a $100K loan, you could be charged anywhere from $17K to $40K in additional costs.
With this in mind, your repayment period can last anywhere from 4 months to 2 years, and in one of two options:
- Pay a percentage of your weekly credit card sales. This option allows you to pay 8-10% of your total M-F credit card sales (excluding holidays), which means that your loan will typically be paid off within 6-8 months.
- Repay a fixed daily or weekly amount. Pay the same amount each weekday (excluding holidays), which will have a fixed term between 4 months and 2 years.
Regardless of which repayment option you choose, your lender will typically withdraw these payments via ACH deposit.
Since the LendVantage service is free and they are the not ones providing you with capital, there is no refund policy listed on their website. However, if you have questions, you can contact them directly at 800-677-2211.
What’s the Bottom Line About LendVantage?
With all this in mind, if your business needs an infusion of capital quickly, does LendVantage provide the best option? Perhaps, but keep the following in mind:
First, remember that LendVantage’s lender network is providing you with the loan, not LendVantage themselves. This means that if something goes wrong, you’ll need to remedy the situation directly with your chosen lender, not with LendVantage.
Next, similar to lending sites such as CashAdvance.com, RapidLoansDirect, and many other short-term lenders, LendVantage’s lenders will likely submit you to extremely high “fees,” which can amount to 40% of your total loan amount. Also, it’s important to note that these are not considered traditional “loans,” because there is no APR associated with them; only a fixed “discount” that represents the difference between the loan amount and the final repayment amount. It’s admittedly a different concept to wrap your head around, so you may want to read through LendVantage’s FAQ in order to gain a better understanding.
Also, remember that because LendVantage’s lenders require that you’ve been in business for at least 4 months and can show at least $10K in monthly revenue, they probably won’t be your best option if you’re still in the planning phase or are a brand-new startup.
Finally, despite the fact that LendVantage claims to have been in business since 2007, they appear to be a very new company, as their URL was just registered in February 2014. As such, there are currently no online customer reviews that can be used in order to gauge overall satisfaction levels. However, some of the most common complaints associated with other direct and/or short-term lenders are extremely high interest rates and/or fees and unfavorable terms and conditions. Because of this, it’s very important that you thoroughly read and understand your lender’s contract before signing.
Bottom line: Regardless of which LendVantage lender you’re assigned to, keep in mind that your quick infusion of cash will come at a price, most often in the form of steep repayment terms. On top of this, without any online customer reviews about the company, you can’t be sure whether or not their lenders are reputable, friendly, and upfront. As such, you may want to research all your business lending options before deciding on LendVantage.