Lendio Review 2020: A Funding Marketplace to Save You Time and Money

If a lender has ever rejected you for a small-business loan or other financing, you know that rejection can hurt your business’s growth and jeopardize its future. You’re not alone in that feeling. Big banks approve less than 27% of loan applications, and alternative lenders approve just 56% of applications.¹ That leaves a lot of businesses out in the cold, without the funding they need to thrive.

Small businesses get denied for loans or other funding for many reasons, like poor credit history, too few years in business, or a risky industry outlook. But sometimes, you’re applying for the wrong financing from the wrong lender—or at least, that’s what Lendio believes.

That’s why Lendio works as a financing marketplace to match you with the right financing from the right lender. But does Lendio have matchmaking magic, or will it set you up with all the wrong lenders?

Let’s find out.

Traditionally, applying for financing takes a lot of time. You have to research lenders, gather various documents, submit an application, wait to hear back, possibly find and submit more documents, and then wait for funding—and that’s before you get into shopping around for the best deal or applying to multiple lenders because the first one rejected you.

Lendio makes the application process easier on you. Simply fill out Lendio’s online application (which should take only 15 to 20 minutes), and you’ll get matched with several lenders who want to finance you. Then you can pick the one that offers the best deal for your needs.

That means you can avoid research and shopping around. Instead, you can fill out one application and let Lendio do all the work. No more getting rejected by a lender and starting over. No more wondering if you got the best deal. With Lendio, the deals come to you.

Even better, Lendio will match you with lenders for just about any kind of financing you can think of—whether you want a business loan, a merchant cash advance, a line of credit, equipment financing, or something else, Lendio can help you get it.

Now, we do need to point out that Lendio does have its downsides. Take funding times, for example. Yes, one application with Lendio will probably save you time compared to applying with a bunch of different lenders. But individual lenders (like Kabbage) offer instant approval and near-instant funding. Lendio, on the other hand, needs at least a day or two to shop around for you―and then you still have to wait for funding after that.

Likewise, while Lendio will try to get you the best possible deal on business financing, that doesn’t always mean you’ll get a loan offer you like. Depending on your qualifications, you may end up with a higher interest loan than you’d like or even get offered just non-loan financing (like a merchant cash advance) instead of a term loan.

So if you’re in a hurry to get funded or you’re picky about the exact loan and lender you want, Lendio (and lending marketplaces as a whole, for that matter) probably won’t be the best fit for you.

But with an easy application and a variety of financing options, we think Lendio can work well for most businesses. Before you race off to apply, though, let’s explore how Lendio gets you those great deals.

We’ve already mentioned this, but let’s make it clear: Lendio is best described as a financing marketplace or lending marketplace―not a lender. It doesn’t offer financing itself but instead matches you with lenders that do. That includes lots of online or alternative lenders, but it also includes some big banks you might recognize. All told, Lendio can hook you up with over 75 different lenders.

Because Lendio offers many types of funding from many lenders, you have good odds of getting the financing you need. This also means that Lendio as a whole has relatively lax application requirements.

Of course, different lenders and different types of financing will have stricter requirements—you can get a merchant cash advance even with bad credit, for example, but probably not a real estate loan. The better your credit history, the more likely you are to get the best business loans.

With that caution in mind, you can think of Lendio as a one-stop shop for your funding needs. Whether you need commercial real estate financing or invoice factoring, Lendio has the funding for you at competitive rates. Let’s take a look at what specifically it offers.

Lendio offers most funding options you could want: big funds and little funds, short terms and long terms, loans for great credit and loans for bad credit, funding for buying commercial property and funding for making payroll, and so on. Lendio has it all.

In fact, with its many types of business loans, we think Lendio has loan options for pretty much everyone.

But rather than focus on the big Lendio picture, let’s dig deeper into Lendio’s offerings. What can you use them for? How do you qualify? How fast can you get funded?

Buckle up—we’ve got 11 types of funding ahead.

Let’s take it from the top.

A business line of credit helps improve cash flow by providing a revolving form of credit. You only pay for what you use, much like a credit card. Unlike credit cards, business lines of credit usually have no (or low) cash advance fees. Plus, they tend to have lower APRs.

To qualify for a business line of credit with Lendio, you’ll need at least $50,000 in annual revenue and a credit score of at least 560—though you’ll likely have to offer a personal guarantee. If you qualify, you can expect to get funded in one to two weeks.

SBA loans offer lengthy terms and low interest rates, making them desirable for small-business owners. Because these loans come backed by the Small Business Administration (SBA), you can often get one without having stellar credit.

Lendio offers several types of SBA loans: the SBA 7(a), SBA Express, and SBA 504. Both the 7(a) and Express loans require collateral, while the 504 requires a sizable personal guarantee. Funding through an SBA loan will take a while—between 30 and 90 days.

Short-term loans give you fast financing—you can get funded in 24 hours—at reasonable rates. These loans do come with shorter terms (hence the name) and higher interest rates than long-term loans, making them best for urgent funding needs that you can quickly repay.

You’ll need strong credit to qualify for a short-term loan with Lendio. You should have been in business at least two years, also. Depending on your lender, you might also need to provide some form of collateral to get approved. Short-term loans offer fast funding, so you can get your funds in as a little as one day.

A merchant cash advance gives you an up-front sum in exchange for a percentage of your future credit card sales. Your lender automatically gets an agreed-upon cut of your daily credit and debit card sales until you’ve repaid the advance plus interest. Merchant cash advances offer a convenient way to repay, but they come with a high APR.

However, merchant cash advances work well for businesses with poor credit. Most businesses can qualify, though you will need to show you have enough credit card transactions to repay the advance. Plus, merchant cash advances give you fast cash—you can get funded within 24 hours.

When you think “business funding,” business term loans probably come to mind first. These loans provide fixed rate interest, as well as terms that range from one to five years, making them a good choice for a wide variety of funding needs.

Criteria for business term loans can vary widely, but better credit will get you better rates. Depending on your loan, you can get funded within 24 hours of approval.

A business credit card offers another form of revolving credit. You can use it when you need it and only repay what you use. Credit cards may have variable rates, and they often have high APR when compared to some other forms of funding, making them best for small expenses you can repay quickly (like staff lunches or office supplies). As you use it and make monthly payments, you’ll build strong credit.

You’ll need a good credit score to get a business credit card with Lendio; Lendio recommends at least 680. If you’ve only been in business a short time, you’ll also have to personally guarantee your credit card. Once approved, you can get funded in one to two weeks.

Accounts receivable financing refers to invoice factoring and invoice financing. Both allow you to get money from unpaid invoices. With invoice factoring, you sell invoices to a lender. They give you an up-front percentage of the unpaid invoice, then give you the remaining amount (minus fees) after the invoice gets paid. With invoice financing, the lender gives you a loan based on the invoice amount, and the invoice acts as collateral.

This type of financing provides another good option for anyone with poor credit. And accounts receivable financing through Lendio gives you fast funding, often getting you money within 24 hours.

Lendio groups several types of funding under the startup loans heading, including short-term loans, lines of credit, and other loans—basically anything that works well for fledgling businesses.

To qualify for a startup loan, you will need at least six months in business, as well as a 680 personal credit score. And since your business has little history, expect these loans to require collateral. Once you qualify, you can get funding in two to four weeks.

A business acquisition does just what you think it would: it lets you buy businesses or franchises. Simple as that may sound, business acquisition loans have more requirements than some of Lendio’s other funding options.

You’ll have to supply your own personal and credit history as well as the health and history of the business you intend to acquire. If all goes well, you can get low interest rates and access to your funds in 30 days.

So you see that Lendio offers financing for your needs—but how does it work? Easy.

It all begins when you fill out an application. You can do it online in about 15 minutes. This application will ask you basic questions about you, your business, and your credit history. You might need to upload some basic documents at some point, like bank statements or tax returns, to help Lendio see your debt-service coverage ratio (basically, whether or not your business makes enough to take on loan payments).

Next, Lendio uses your application to find lenders willing to extend you financing. Lendio promises to get back to you within 72 hours about your eligibility for funding.

Once Lendio has found the best offers for you, it will report back with your options so you can compare. If you see one you like, Lendio will put you in touch with the lender, and you can finalize everything.

And voila! Funding for you.

Throughout the process, you’ll have a personal funding manager to guide you. They act kind of like a loan officer, except they don’t work for any specific lender—they just want to get you a good deal. Expect them to give you a call after you turn in your initial application. This person will help you understand your financing options and make recommendations so you can get the right funding for your situation.

Again, this process should save you time and get you a better deal. Without Lendio, you might just apply for the first loan you see. If you get accepted, you’ll take the deal without shopping around—because who has the time or energy to apply to several loans so you can compare offers?

With Lendio, these comparisons are essential to the process, so you can feel confident you’re not getting ripped off by a greedy lender.

We like Lendio, but it’s not the only lending marketplace out there. Fundera and Nav provide the most competition. So how do they compare?

Fundera functions a lot like Lendio—you fill out an application and get matched with loan offers. They both offer many types of business loans from many business lenders (though Lendio has a larger network of lenders than Fundera does). And honestly, they have pretty comparable customer reviews, with each marketplace earning a 4.7 (of 5) on Trustpilot.^{2, 3}

Note that Fundera offers personal loans, which Lendio doesn’t. On the other hand, Lendio offers commercial real estate loans, which Fundera doesn’t.

We think you’ll have a good experience with either lending marketplace. But if you’d like a more detailed comparison, we have a guide comparing Fundera vs. Lendio.

Nav works similarly to Lendio too. You tell Nav about your business and your financing goals, and it matches you with lenders. And just like Lendio and Fundera, Lendio and Nav have comparable customer reviews. Both earn a 4.7 out of 5 on Trustpilot.^{3, 4}

Nav does have some nice credit monitoring features that Lendio doesn’t. It offers a free service that gives you both your personal credit score and business credit score.

Have more questions about Lendio? We have more answers.

Yes, you can trust Lendio. Lendio has more than 15,000 reviews on Trustpilot, earning a 4.7 (out of 5) TrustScore.³ Over 90% of those 15,000 reviewers rate Lendio as “great” or “excellent.”

No, Lendio doesn’t guarantee you get funded. But your odds as a borrower are good. Lendio claims to get funding for 65% of applicants—a much higher rate than traditional banks, credit unions, or even alternative lenders (whose rates we discussed at the beginning of this review).

Your prepayment penalties and other fees depend on your specific offers through Lendio. Remember, Lendio is a marketplace, not a lender. You’ll have to look at each offer to see if the lender charges a prepayment penalty or any other fees.

When you run a busy business, time is money. Lendio definitely saves you time—and by letting you compare various funding offers, it probably saves you money too. With connections to plenty of lenders that offer varied types of financing, we recommend Lendio to any business that wants to get good deals without wasting time.

Remember, Lendio works as a marketplace. Its different lenders and loans will have different terms and conditions, so always examine your offers carefully to make sure you understand the fine print.

Think you’ll apply to Lendio? Great! Now figure out how much your Lendio loan will cost you with our business loan calculator.

Disclaimer

At Business.org, our research is meant to offer general product and service recommendations. We don't guarantee that our suggestions will work best for each individual or business, so consider your unique needs when choosing products and services.