About OnDeck
OnDeck is an online small business lender that specializes in providing business term loan options and business lines of credit. For small business owners seeking financial solutions, OnDeck offers a convenient and streamlined lending process. Qualifying applicants can access funds quickly, especially for term loans of $100,000 or less, with the possibility of receiving funding as soon as the same business day in certain states.
Key features
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Loan and Credit Options. OnDeck provides small business owners with the flexibility to choose from both small business loans and lines of credit. OnDeck business loan amounts offered are substantial, with business loans extending up to $250,000 and lines of credit reaching amounts of $100,000.
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Qualification Criteria. To qualify for a business loan from OnDeck, applicants must meet specific criteria. This includes maintaining a personal credit score of at least 625, having a minimum of one year in business, and demonstrating a minimum annual business revenue of $100,000. These criteria ensure that businesses seeking financial assistance through OnDeck have a certain level of financial stability and operational history.
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Geographic Limitations. It's essential for potential borrowers to note that OnDeck's services are not available in North Dakota. This geographical restriction is a crucial aspect for businesses considering OnDeck for their financing needs, as availability varies by state.
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Inclusive Credit Score Requirement. OnDeck adopts an inclusive approach by accepting borrowers with a minimum credit score of 625. This lower credit score threshold allows a broader range of businesses to access financing, promoting inclusivity in the lending process.
Pros and cons
Pros
Cons
Reliability
OnDeck's A+ rating from the Better Business Bureau (BBB) is a positive indicator of its reliability. The BBB assigns ratings based on various factors, including customer reviews, business practices, and the company's responsiveness to customer concerns. An A+ rating suggests that OnDeck has demonstrated a commitment to ethical business practices and customer satisfaction.
How to apply for an OnDeck loan?
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Online Application. Start by completing an online application on the OnDeck website. During this step, you will be required to provide essential information about your business. This includes your business tax ID, three months of business bank statements, and a current month-to-date statement of activity. Alternatively, you can choose to provide this information over the phone.
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Loan Expert Consultation. After submitting your application, expect to receive a call from a dedicated loan expert within one business day. During this consultation, you'll have the opportunity to discuss the loan offers available to you. It's important to note that this stage is a loan pre-qualification, and there won't be a hard inquiry on your credit report at this point.
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Review and Acceptance. Upon receiving your loan offers, carefully review the terms, including the loan amount, repayment schedule, and other relevant details. If you are satisfied with the offer, you can proceed to finalize your loan terms and application through an online checkout process.
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Loan Approval and Funding. Once you've completed the finalization process, your loan application will undergo approval. If approved, you can expect to receive your funding as quickly as the same business day or within two to three business days. This expedited funding process is designed to meet the immediate financial needs of small businesses.
Сonditions and requirements
Conditions
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Short-Term Business Loans. OnDeck's short-term business loans are designed to provide quick financing solutions with repayment terms of up to 24 months. Borrowers can access loan amounts ranging from $5,000 to $250,000, depending on their qualification. However, it's important to note that the maximum repayment term is relatively short at 24 months. The starting APR for OnDeck business loans is 35.40%, and the average APR is reported to be 60.9%. Additionally, borrowers should be aware of the origination fee, which can range from 0.00% to 4.00%.
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Business Line of Credit. OnDeck's business line of credit offers a flexible funding solution for businesses. Instead of receiving a lump sum as with a traditional term loan, this option provides a revolving credit line that can be drawn upon as needed. The loan amounts for the line of credit range from $6,000 to $100,000, and repayment plans are available for 12, 18, and 24 months. Each time funds are withdrawn, the repayment plan resets.
Requirements
To be considered for OnDeck's term loans or lines of credit, applicants should adhere to the following eligibility requirements:
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Business Experience. A minimum of one year in business is required. OnDeck looks for a track record of at least a year of business operations.
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Credit Score. Applicants need to have a personal FICO score of at least 625. This credit score requirement reflects OnDeck's baseline for evaluating the creditworthiness of potential borrowers.
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Annual Business Revenue. Businesses should demonstrate a robust financial standing with a minimum annual revenue of $100,000. This criterion ensures that the applicant's business has a certain level of financial stability.
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Business Account. An essential requirement is the possession of a business checking account. This indicates the financial structure of the business and serves as a practical account for loan disbursements and repayments.
While these are the fundamental criteria for eligibility, meeting them does not guarantee automatic approval. OnDeck conducts a thorough assessment, taking into consideration additional factors such as:
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Payment History. OnDeck evaluates the applicant's history of making timely payments, providing insights into their financial responsibility.
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Total Debt. The total debt obligation of the business is considered, giving OnDeck an understanding of the existing financial commitments.
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Percentage of Business Ownership. The percentage of ownership in the business is a factor, helping OnDeck gauge the level of commitment of the applicant.
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Business Credit. The business's credit history is examined, providing valuable information about its creditworthiness.
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Business Cash Flow. OnDeck assesses the cash flow of the business to ensure its ability to handle loan repayments.
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Public Records. Any relevant public records are taken into account during the evaluation process.
Ways to receive the money
Upon loan approval, you'll receive the borrowed amount in your bank account by 5 p.m. ET on the same day, provided you meet specific criteria. Same-day funding is available in certain states and for OnDeck loans up to $100,000, subject to creditworthiness and term length restrictions. To qualify for same-day funding, loans must be approved before 10:30 a.m. ET. If not eligible for same-day funding, the funds will be disbursed via ACH payment within two to three days.
Products
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Business Term Loans. OnDeck's business term loans are tailored to offer short-term financial solutions with a repayment window of up to 24 months. Businesses can secure loan amounts ranging from $5,000 to $250,000 through an application process designed for efficiency. The starting APR for term loans is 35.40%, with an average APR of 60.9%. Additionally, OnDeck charges an origination fee, varying from 0.00% to 4.00%, contributing to the overall cost of borrowing.
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Business Lines of Credit. OnDeck's business lines of credit provide a flexible financing option through a revolving credit line. Businesses can draw funds as needed, with loan amounts ranging from $6,000 to $100,000. Various repayment plans of 12, 18, and 24 months offer businesses flexibility.
How to repay an OnDeck loan?
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Term Loans. OnDeck typically prefers to receive payments through an ACH electronic funds transfer (EFT) directly from your business bank account. Term loans from OnDeck come with either fixed daily payments (every business day) or weekly payments through ACH. The frequency is determined based on your agreement with OnDeck. The agreed-upon amount will be automatically debited from your business bank account on the specified schedule.
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Line of Credit. For a line of credit with OnDeck, the repayment process is automated and occurs on a weekly basis. The predetermined repayment amount will be automatically deducted from your business bank account, ensuring timely and hassle-free repayment.
Other Loans
Reasons for getting rejected for an OnDeck loan
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Insufficient Business History. OnDeck typically requires a minimum of one year in business. If a business hasn't been operational for at least this period, it may not meet OnDeck's eligibility criteria.
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Low Credit Score. OnDeck has a minimum credit score requirement of 625. If an applicant's personal FICO score falls below this threshold, it may lead to rejection.
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Inadequate Annual Business Revenue. OnDeck looks for businesses with a minimum annual revenue of $100,000. If a business's financial performance does not meet this criterion, it might result in rejection.
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Unfavorable Payment History or Creditworthiness. OnDeck considers factors such as payment history, total debt, business credit, and the percentage of the business owned. A poor payment history or unfavorable creditworthiness may lead to rejection.
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Not Meeting Additional Qualification Factors. In addition to the basic eligibility criteria, OnDeck considers various other factors like business cash flow, public records, and the overall financial health of the business. If the business does not meet these additional qualification factors, it may face rejection.
Alternatives
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Fundbox is an online lender that provides lines of credit for small businesses. It offers a straightforward application process and quick access to funds. Fundbox is known for its flexibility in working with businesses that may have lower credit scores.
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Funding Circle is a peer-to-peer lending platform that connects small businesses with individual and institutional investors. It offers term loans with competitive interest rates. Funding Circle is recognized for its transparent and borrower-friendly approach.
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Credibly is a small business lender offering a variety of financing solutions, including short-term loans and working capital. Credibly focuses on providing funding to businesses that may not qualify for traditional bank loans.
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Rapid Finance specializes in providing alternative financing solutions for small businesses, including merchant cash advances and short-term loans. It aims to offer fast funding to meet the immediate financial needs of businesses.
OnDeck stands out as an excellent choice for short-term business loans, offering the flexibility of borrowing substantial amounts, even for businesses with a minimum credit score. What makes OnDeck particularly attractive is its ability to provide funds swiftly, with same-day approval and disbursement for qualifying applicants. Moreover, OnDeck emphasizes the opportunity to build and strengthen business credit by consistently making on-time payments. The loan terms range from 18 to 24 months, with loan amounts spanning from $5,000 to $250,000. While the starting interest rate is 35.40% for a portion of customers, the accessibility and speed of funding make OnDeck a notable player in the short-term business loan landscape. Funding Circle distinguishes itself in the realm of long-term business loans by offering competitive rates, extended repayment terms, and a lack of prepayment penalties. This lending option caters to businesses seeking larger loan amounts, ranging from $25,000 to $500,000, with a reasonable starting interest rate of 11.29%. Beyond financial support, Funding Circle prioritizes efficiency, enabling businesses to access funds in as little as two business days. Notably, Funding Circle also showcases its commitment to diversity by providing funding options specifically tailored for women-owned businesses and minority entrepreneurs. The loan terms extend from 6 to 84 months, making Funding Circle a favorable choice for businesses with a more extended financial horizon. Credibly positions itself as a reliable source for working capital loans, particularly for businesses requiring quick funding to address immediate operational needs like payroll or inventory expenses. Notably, Credibly's working capital loans boast a rapid approval process, often providing funds in less than 24 hours. The lender exhibits flexibility by considering applicants with a minimum credit score of 500 and a willingness to look beyond a less-than-perfect credit history, provided there is a healthy annual revenue. Beyond working capital loans, Credibly collaborates with a network of lenders to offer a diverse range of financing options, including merchant cash advances, business lines of credit, equipment financing, SBA loans, and invoice factoring. For startups in need of swift financing, Fundbox presents an appealing option with its business line of credit, offering up to $150,000. What sets Fundbox apart is its relatively lenient eligibility criteria, allowing new companies to qualify after just six months of operation and a minimum annual revenue of $100,000. The business line of credit provides the flexibility to withdraw funds as needed, and businesses only pay interest on the amount utilized. Additionally, Fundbox offers perks such as up to 20% off fees through its Fundbox Plus upgrade. With competitive starting interest rates ranging from 4.66% for 3-month terms to 8.99% for 6-month terms, Fundbox addresses the financial needs of emerging businesses seeking quick and accessible startup loans.Loans like OnDeck
OnDeck
Funding Circle
Credibly
Fundbox
Editorial Opinion
Make sure to confirm whether the lender is licensed to operate in your state. You can verify this information with your state regulator or attorney general. Check if the lender is a member of a reputable association, such as the Community Financial Services Association of America. Membership in such organizations may provide an extra level of reliability. Carefully review all the terms and conditions of your payday loan contract. Thoroughly examine the interest rates on payday loans and ensure that your contract includes a detailed breakdown of the total cost of the loan. Take advantage of your right of rescission. Usually, you can rescind the loan within three days after signing the agreement. Alternatively, there is typically a "cooling-off" period, which allows you several days to thoroughly review the contract before making an informed decision to enter into a consumer loan agreement based on the terms specified by the lender. Choosing a payday lender is a significant decision that demands careful consideration and a good understanding of how such organizations operate. At Finanso, we've carried out a comprehensive analysis of over 50 business lenders, assessing them based on 35 different parameters across six key categories: accessibility of loans, customer relations, quality of service, interest rates, and transparency of conditions. In each category, we carefully considered the most critical factors in selecting a lender. These factors include the interest rates, available loan amounts, minimum credit score, minimum income, application fees, and the speed at which funds are transferred. At Finanso, we highly value our users, which is why we also focus on the quality of customer service, user reviews, and additional features that can aid our users in making a well-informed decision. Our ultimate goal is to provide insightful recommendations and expert advice to assist you in selecting a lender that best caters to your specific needs.Important
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