Before you get an online business loan, ask yourself, do I really need the money this quickly?
When it comes to getting a business loan through an online-only lender, expect to get the funds in seemingly lightning speed — sometimes within a few days.
Here’s the catch: That convenience and speed can come at a steep price. Some small business borrowers have paid as much as 150% APR, or annual percentage rate. Before signing those loan documents, ask yourself: Do I really need this financing so quickly?
If you have a non-urgent business need, then it may make more sense to work with a traditional or nonprofit community lender. Through them, you’ll wait a bit longer but expect to pay anywhere between 5% to 18% APR. Much better, right?
How do online-only firms justify charging higher interest rates? Their vetting process is not as stringent, which means they face a higher chance their borrowers may not repay their loans. To make up for this risk, they tend to charge higher rates.
Are you looking into the pros and cons of online-only loans? Our simple, skimmable guide will walk you through the key questions to ask before making a decision on the best financing for you and your needs.
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CDC Small Business Finance is a leading business lender and community-focused nonprofit. We offer affordable loan options to help business owners like you start or expand their operations. Unlike traditional lenders, we also look out for you as a consumer advocate. This means we’ll only match you with a loan that supports the longer-term goals of your business.
Tell our loan experts about your business and its needs, and they’ll work to match you with an affordable, sustainable loan that’s best for you. Let’s talk! Reach us at firstname.lastname@example.org or (619) 243-8667.
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- Researching online-only business loans? First, ask yourself: Why do I need one?