Business owners across the world, now more than ever, turn to online lenders to keep their cash flowing and their doors open. One of the significant names in the business finance game today is Lendio. But, is Lendio a legit company? You want an honest answer, so here it is.
Let’s examine actual Lendio reviews from some of the most trustworthy consumer sites and thoroughly examine the brand’s offer. Here’s what we’ll cover.
- What is Lendio?
- How does Lendio Work?
- Is Lendio an SBA-Backed Lender?
- Now, How to Decrypt Mixed Lendio Customer Reviews
- +Bonus: A Quick Look at Lendio’s Franchise Offer
- Final Answer: Is Lendio Legitimate?
Read on to piece together the puzzle.
What is Lendio?
Lendio is a simple small business loan marketplace. The platform connects business owners with the lenders that they are most likely to obtain funding from. The platform offers connections with lenders who offer all types of cash flow increasing options like credit, loans, equipment financing, mortgages, accounts receivable financing, and more.
Who is Lendio and Where is the Company Based?
Lendio, Inc. was founded by Brock Blake, the current CEO, in 2011 and the company extended their first loan in Q4 2013, according to Wikipedia. The CFO is Chad Iverson. Company headquarters are located in Lehi, Utah.
How does Lendio Work?
If you’re a small business seeking funding, here’s what you might expect from Lendio. The application should take about 15 minuted to complete and will connect you with 75+ lenders. In many cases, you could get the funds you seek in as little as a day.
First, Lendio looks at your self-reported credit score range. Then, they find out how long you’ve been in business and how much money your company has generated over the last 90 days. After that, they ask what you need funding for.
Terms and conditions vary for business acquisition vs expansion or payroll, for example. So, by determining why you need funds, they filter out various lenders who aren’t likely to approve you.
When that’s over, the platform looks at certain aspects of your business that may help or hurt your qualification odds like if you have a prior bankruptcy or if you operate as a non-profit.
Once you’ve shared the above, the platform looks at the location of your business, your annual personal income, and your percentage of ownership in the company. Finally, there is a differentiator between Lendio and competitors: they want to know what factors are most important to you whether it be amount, speed, or cost of funding you’re looking for.
Once you agree to the terms and conditions (*which include the possibility that you’ll be contacted by auto-dialers and partners — probably why many people are asking “How do I get rid of Lendio emails?”), the platform will do a soft pull of your credit via Experian using your social security number. At this point, they don’t ask for your DUNS number.
If the platform can’t make the connection automatically, Lendio will ask you to manually enter your business’ financial information. You’ll be asked for your entity type and annual profits.
And, if you’re likely to be qualified through one of Lendio’s partners, they’ll let you know instantly and connect you to a possible funding channel.
If not, the platform lets you know precisely what’s standing in your way of getting funded and tells you what to do next.
And, when this happens, the system will suggest the next steps you can take to get ready for funding, which may include applying for a credit card or connecting with a partner like LegalZoom or Credible.
What Type of Funding Can You Get Through Lendio?
Via Lendio, you can access several types of funding types from their network of banks and online lenders. Now, let’s examine a handful of them and, for each, see some of the top lenders in their network.
First, here’s a quick summary.
If you’re looking for plastic, they have it. Just determine how much you need and the Lendio platform will try to help you determine which credit card issuer is likely to help you get it and at what rate. In many cases, you could be looking at 0% introductory APR offers, but this is likely to increase later. And, if you’re not quite ready for larget credit lines, Lendio might connect you with credit building options.
Some of the leading credit cards Lendio might match your business with could come from Chase, American Express, LenCred, Bank of America, Credit One, and Seek Business Capital.
Lines of credit
Through Lendio, line of credit amounts can range from $1K to $500K with interest rates between 8 – 24% and terms between one and two years. If your company qualifies, you may be able to access funds as quickly as within a couple of weeks.
For business lines of credit, Lendio might connect you with Kabbage, Blue Vine, Fundbox, Headway Capital, or Fundation among others.
Term loans that you can apply for through Lendio might range from $5K to $2M with have interest rates as low as 6%. And, the terms can range between one and five years. Access funds obtained through the platform in as little as 24 hours.
Some of the term loan providers Lendio could link you with include OnDeck, Fundation, American Express, Funding Circle, Opportunity Fund, Credibility Capital, and Lending Club.
In most cases, startup loans can be the most difficult to obtain because financial institutions are more eager to lend to an established business. But, if you meet the requirements, you can leverage loans of $500 to $750K at interest rates between 0 and 17% to start a business. Access funds in two to four weeks and pay off your loan over the course of 25 years.
Startup loan offers that Lendio might match you with could come from Chase, American Express, or Bank of America.
Accounts receivable financing
Have outstanding invoices? Then, you may be able to leverage them as collateral through accounts receivable financing throught the Lendio platform. Get cash in an amount up to 80% of your current accounts receivables and pay factor rates as low as 5%. Get this type of funding in as little as 72 hours and pay it off in a year or less.
If you qualify for accounts receivable financing through Lendio, it might come from Eagle Business Credit, Internex Capital, BlueVine, FundBox, or ActionCapital.
What is Sunrise by Lendio?
In some cases, the next steps that the platform claims will set you on the journey to obtain working capital, loans, or credit via the platform will include signing up for Sunrise, the brand’s bookkeeping software.
If you create an account, you’ll be asked what your priority is. For example, are you looking to apply for PPP loan forgiveness, send and track invoices, or manage your banking?
When connecting your business banking information, Sunrise gives you the option to connect to major banks as well as smaller community banks and credit unions. From the dashboard, you can track income and expenses, send and receive invoices, and manage your business bank accounts.
This platform isn’t as automated or feature-rich as leaders like Quickbooks, but it seems to have everything you need for simple accounting and invoicing. Plus, invoicing only costs 1% per transaction, which is low.
Is Lendio an SBA-Backed Lender?
Lendio was one of 19 finetch companies participating in PPP loan application processing as of May, 2020. Yet, Lendio is not a lender. Instead, they match you to the most appropriate lenders in the United States based on your needs. And, the SBA does approve of their legitimacy.
So, Has Lendio Funded any PPP Loans?
As of July 2020, Lendio reported to have facilitated $10BN in total funding for the PPP program. And, despite the fact that August 8, marked the end of the PPP application period this year, Lendio is still accepting PPP applications in hopes that congress will extend the small business relief program. Still, the company does not provide direct funding.
Yet, according to many, Lendio is a good source for PPP application processing.
And, If They’re Not Funding, How Does Lendio Make Money?
Lendio doesn’t charge a fee, so how do they make money? Well, they don’t charge the small business owner. Instead, the get their money as a sort of finder’s fee or a setup similar to affiliate marketing from the Lenders who fund their applicants.
Think of Lendio as a broker who takes a cut from the big guy. Note that this typically means that the applicant may pay more than if they cut out the middle man and apply directly with a lender. But, the latter is a less convenient option.
Now, How to Decrypt Mixed Lendio Customer Reviews
On one hand, you’ll see 5-star reviews like the one above. Then, on the other, you’ll come across the naysayers. Take the following, for example:
Even if they make up a small portion of feedback, this caliber of review is enough to make you think twice about doing business with a financial company.
If you check out forums like Reddit, you might read about wonky system glitches.
Then, if you dig further, you may find that Lendio, Inc. is not BBB accredited and they have mediocre ratings on the platform.
So, what should you make of this confusion?
First of all, I need to point out that 2020 has been a whirlwind. I don’t know of a single company who didn’t face unexpected challenges this year. Our proverb for the year should be, “Have patience and trust the process.” Now that we got that out of the way, let’s just say that it is what it is.
Very few brands have a 5-star rating across the board. And, this doesn’t mean that they aren’t helpful or legitimate. TrustPiolt and BBB are designed for consumers, and most people don’t run to them when they have a great experience. But, if you have a bad experience, you want people to know.
Therefor, I recommend that you read the reviews, trust that you might expect similar results, but don’t judge too harshly based on the bad experiences. Many business owners have leveraged this platform and marketplace to grow their businesses. If the system is a good fit, you could be one of them.
+Bonus: A Quick Look at Lendio’s Franchise Offer
Before we wrap up, I want to mention another feature of Lendio’s offer in case you were wondering. Since 2016, they’ve presented the option to Franchise their offer for your own gain (up to 70% commission to keep for yourself).
In most US states, excluding California, Utah, and North Dakota, franchise opportunities are open to the public. So, if you live in any other state, you have excellent business networking skills, and you’ve got $55-65K to invest, this might be worth looking into.
Final Answer: Is Lendio Legitimate?
Yes, Lendio is an established, trustworthy company. They’ve helped many small business owners get financed. However, this is not the funding marketplace I recommend. Instead, I have more trust in Nav and feel that their offer provides more value while giving the business owner heightened control over the funding process.
If you want to learn how to build business credit so you can obtain up to $100K in funding in 30 days, enroll in Business Credit Workshop today.