Founded in 2008, OnDeck provides small businesses with access to financing through business lines of credit and term loans. OnDeck offers two borrowing options that may be suitable for companies that require fast access to cash. There are two solutions available from the company. The first is a line of credit, which allows companies to borrow as needed. The second one is small business loans. Ondeck advertises its services on its website.
There are a lot of different lenders out there that offer business loans, so it can be difficult to know which one is right for you. A popular lender like OnDeck has gained a lot of attention recently, but is it the best option for your needs? Below we examine what they have to offer to assist you in making an informed choice.
You can borrow money online with OnDeck using a business line of credit or a business term loan for your small business.
In reviewing their website and terms and conditions, we discovered a few interesting points. Here are a few that caught our attention.
- OnDeck’s average rate for term loans is 62.1% APR, while its average rate for lines of credit is 48.9% APR.
- There are loan amounts ranging from $5K to $250K available.
- There are repayment terms of up to 24 months available.
- Only certain states offer same-day funding for term loans up to $100,000.
- The eligibility rules for the loan are based on creditworthiness and the length of the loan.
- A term loan that includes the Prepayment Benefit option will have a higher interest rate, which may result in a higher total cost.
- A personal guarantee is required in addition to the business lien.
- OnDeck business loans and lines of credit are available to you
- It is possible that your business loan will be issued by a member of the OnDeck family of companies or by Celtic Bank, a Utah-Chartered Industrial Bank, depending on the state where your business is located and the other attributes of your business and the loan.
- It is not possible for OnDeck to provide financing to businesses located in Nevada, North Dakota, or South Dakota.
OnDeck: What is It?
An online lending platform, OnDeck provides short-term business loans and lines of credit to small businesses. OnDeck is headquartered in New York, NY, and can be reached at (888) 269-4246.
With an A+ rating on the BBB and an average of 121 customer reviews, OnDeck is an attractive option for small business loans. They have closed 35 complaints in the past three years.
There are two main types of loans offered by OnDeck: short-term loans and lines of credit. Both have their own advantages for small businesses.
How Does This Company Work?
The OnDeck loan application process is straightforward and offers a variety of loan products to small businesses. The entire process can be completed online or over the phone with the assistance of a loan advisor. Once your application is submitted, you will receive a decision within 24 hours. In the event that you accept the funding option and agree to the repayment terms, funds will be deposited into your account as soon as possible.
The lender of your business loan may be a member of the OnDeck family of companies or Celtic Bank, a Utah-Chartered Industrial Bank, Member FDIC. The lender will be identified in the loan agreement before you sign it. Loans are subject to lender approval.
How To Qualify For OnDeck?
OnDeck requires a business to be in operation for at least 1 year, have a personal Fisco score of 650, generate $100K in minimum annual revenue, and have a business bank account to qualify for a loan.
The OnDeck loan application process is partially automated, but you will also speak with a loan advisor after completing the application. The advisor will explain how the loan works and guide you through the repayment process.
The following are some of the basic requirements:
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- Employer Identification Number (EIN) for businesses
- SSN (Social Security Number)
- Tax ID number for businesses
- Estimated gross revenue for the year
- Balance of the average business bank account
A copy of your business bank statements for the last three months may also be required as part of your application for an OnDeck loan. An OnDeck loan advisor will contact you within one business day, usually less than a day after your application. During this time, they will discuss your options with you and explain the details, including the terms, amounts, and repayment schedules. If you are satisfied, you can proceed to the online checkout process.
They have a business line of credit, a revolving account similar in several ways to a business credit card. For this financing, you will be assigned a credit limit so that you may borrow as much as you qualify. This credit limit can be utilized as long as the balance is repaid during the draw period.
You will be able to explore your loan options as well as understand how the loan is developed and repaid. The interest rate and fees may be higher than those offered by other business financing options.
In the last three years, OnDeck has closed 35 complaints, according to the Better Business Bureau. They have an A+ rating and an average of 121 customer reviews.
The following are some reviews:
Richard M 09/21/2022
James N 06/23/2022
Steven H 05/26/2022
How Much Does OnDeck Charge?
With OnDeck, one of the largest online providers of small business loans, small businesses can avail of both term loans and business lines of credit to meet their financing requirements.
Term loans and lines of credit have an average interest rate of 62.1% and 48.9%, respectively. Loan amounts can range from $5,000 to $250,000, with repayment terms of up to 24 months. OnDeck also charges a one-time origination fee and a monthly maintenance fee, as most other lenders do.
Is There Any Pre-Payment Penalty?
Unlike other lenders, OnDeck does not charge prepayment penalties, so borrowers can pay off their loans early without incurring any penalties.
To establish business credit, OnDeck reports your payment activity to three credit bureaus: Experian, Equifax, and PayNet. Therefore, if you make timely payments, you will be able to use your OnDeck loan to establish business credit.
If you pay off the loan before the due date, there is no prepayment penalty, and you pay interest only on the amount used.
In addition, some applicants may be eligible for a Prepayment Benefit where OnDeck waives any remaining interest on their loan if they choose to pay off their line of credit or term loan early. OnDeck does not charge a prepayment penalty. However, if you do not qualify for the Prepayment Benefit, you will still be responsible for 75% of the remaining interest on your loan contract.
How Does It Affect Your Credit?
To make an informed decision when applying for a loan, it is important to understand the process and how it might affect your credit score.
You can choose between weekly or daily payments for your OnDeck small business loan, which offers a 12-month repayment term that resets after each withdrawal.
It is common for lenders to perform a soft credit check in the beginning to determine your eligibility for a loan. This will not affect your credit score. However, once you decide to proceed with the actual loan application, the lender will need to do a hard credit inquiry to obtain a complete picture of your credit history and determine a final rate. These hard inquiries can adversely affect your credit rating.
While OnDeck encourages the honoring of your payments, there is always the possibility of unexpected financial difficulties. Fortunately, your personal credit score will not be adversely affected if you cannot fulfill the terms of your loan. The business credit score will, however, be adversely affected.
How To Cancel OnDeck?
Be sure of your decision before taking out a personal loan. After the funds have been disbursed into your account, you cannot reverse or cancel the transaction. So, make sure you are sure upfront to avoid any cancellations or changes later on.
Need some help making ends meet? Here’s what you need to know.
It’s possible to get your finances in order, no matter what your situation is. Just follow these simple steps and soon enough, your future will be bright.
- Setting a budget is the first step to keeping your spending under control and leaving room for other important expenses.
- Consult a financial advisor who can explain your options and set up a plan that fits your needs.
- Finally, don’t worry about debt too much. Many companies are willing to work with you to create a more manageable payment plan. Just contact their customer service team.
OnDeck: Is It Legit?
A+ rating with the BBB and mixed reviews online, some customers have had great experiences and others don’t. OnDeck has been around since 2006. If you need a small business loan fast or don’t qualify elsewhere, make a few small business loan comparisons before choosing OnDeck.
Doing your research and reading customer reviews can help you choose the best option for you and avoid taking out a loan you can’t afford.
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In operation since 2006, OnDeck offers financial services to businesses. It has an A+ rating from the Better Business Bureau and mixed online reviews, with some customers reporting great experiences and others having negative ones.