National Funding reviews highlight an online lender offering quick financing options for startups and business owners with less-than-perfect credit. However, the convenience and easy approval requirements can come with significant costs.
Despite the company’s wordy website, which can be confusing, National Funding business loans are available in just two types, including working capital and equipment financing. The fintech company can provide up to $500,000 through its loan program and up to $150,000 through equipment financing.
National Funding is a direct lending organization that has been in business since 1999. The company provides funding from its website or through its affiliate partner, LendingTree, one of the premier online lending marketplaces for business financing, the best personal loans, and the best debt consolidation companies.
While National Funding enjoys mostly positive reviews among customers and experts, there are some factors to be aware of when working with the company to keep borrowing costs under control. Below, we’ll examine the benefits of National Funding as well as what to watch out for.
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Pros
Relatively low credit scores required for approval
Funding available within 24 hours after approval
Pre-qualification won’t negatively affect credit score
High borrowing limit of up to $500,000
Funding available for startups in business for six months
Prepayment discounts of up to 7% are available
Cons
Potentially restrictive repayment terms
Limited borrowing options
Potentially high cost of borrowing
Limited consumer information on the company’s website
National Funding Reviews: Features and Benefits
National Funding offers business lending for startups as young as six months old that generate significant revenue. The lender focuses on providing necessary funding to businesses that haven’t had time to develop a solid credit score or to business owners with fair to average credit.
The company offers several repayment term lengths with varying repayment schedules. Applying for financing through National Funding can include a pre-qualification step to determine the likelihood of approval before formally applying and taking an inquiry hit on your credit report.
- Two borrowing options available
- Pre-qualify without a hard credit check
- Factor-rate financing starting at 1.1
- Prepayment discounts are available
- Highly rated company
- Funding up to $500,000
- Equipment loans up to $150,000
- Minimum loan amount of $5,000
- Origination fees apply
- Minimum credit score 600 or 650, depending on loan type
- Minimum business age 6 months
- Minimum revenue to qualify is $250,000 annually
- Funding within 24 hours after approval
- Working capital loan terms between four and 24 months
- Equipment financing terms between 24 and 60 months
- Late payment fees apply
- Daily or weekly payments apply for short-term loans
National Funding Reviews: Editorial Rating
Trusted Company Reviews Rating Score for National Funding Business Loans: 8.4
National Funding has a lot going for it and plenty of customer benefits. We rate the lender highly, along with other experts and most of the company’s customers. National Funding scores points in our best lenders for business loans and startups review by providing rapid funding to young companies and businesses that wouldn’t otherwise be likely to obtain financing through more traditional means. Depending on the loan type, borrowers can receive approval with credit scores as low as 600 or 650.
The company scored bonus points for offering prepayment discounts of up to 7% for working capital loans and up to 6% for equipment financing loans.
However, several scoring factors hurt the company in our review. After our detailed analysis of National Funding, we discovered that the lender is pretty tight-lipped about the actual costs borrowers could pay when working with the company.
Seldom-mentioned origination fees, late payment requirements, potentially high factor-rate terms, and tight repayment schedules that could include daily or weekly payments all cost the company scoring points in our evaluation.
| Funding Type | Rates | Terms |
| Working Capital Loan | 1.1 factor (starts at) | 4 – 24 months |
| Equipment Loan | Not Provided | 2 – 10 years |
Fair-Credit Business Loan Concern Disclaimer
A primary question about obtaining a business loan, especially for a startup business or for borrowers with poor credit, focuses on where to get approved for financing. SBA loans and borrowing from brick-and-mortar banks are often not options for new businesses. In cases of finding financing for businesses that can’t get it through traditional methods, online lenders can fill the need in many situations.
However, because online lenders are often willing to loan money in higher-risk situations, they often charge exorbitant interest rates, fees, and other add-on costs. Often, because of advertising methods, customers are unaware of the higher costs until after committing to the financing. This fact can lead to unhappy borrowers and, worse, cause financial trouble for small businesses in tight financial situations.
A report from the city of San Diego states, “…when it came down to why online-loan clients were unhappy, about one in three respondents said it was due to having to pay high interest rates. Almost half of these customers attributed their unhappiness with the product to lack of transparency.”
However, the report also states, “…online loans do have their specific uses. If leveraged correctly, they can serve as a temporary solution for certain, limited cases.”
That said, while online lenders can fill some business financing needs, it’s essential to do proper research into the precise amounts and details of repaying any business loans you’re considering through an online lender before committing to the deal.
About National Funding Business Loans
National Funding offers working capital business loans of up to $500,000 and equipment financing loans of up to $150,000. Working capital loans have repayment terms between four and 24 months, while equipment financing has terms between two and ten years.
Both types of funding may include origination fees of between 1% and 2% or more. Working capital financing is subject to daily or weekly repayment agreements, while equipment financing payments are monthly.
The company uses factor rates, rather than interest rates, to determine working capital borrowing costs. Factor rates start at 1.1 with National Funding but can reach much higher, undisclosed, amounts. Some customers have reported paying as much as the equivalent of 125% on some loans.
Factor-rate repayments calculate the repayment amount by multiplying the total loan amount by a factor number. For example, a $10,000 loan with a factor of 1.2 will cost $12,000 to repay over its length. National Funding offers a discount for factor-rate loans paid off early.
National Funding approves qualified borrowers with businesses as young as six months old and credit scores as low as 600 for working capital loans. Equipment financing requires a credit score of 650 and a two-year business history. After approval, funds can be available in as little as 24 hours.
Pre-qualification is possible through National Funding’s website and its partner, LendingTree. Pre-qualification draws only a soft credit inquiry that won’t affect your credit score and won’t appear on future inquiries. Taking the step allows you to see your approval odds and potential loan terms before formally applying for financing without negatively impacting your credit score or borrowing ability.
National Funding Business Loan Types
National Funding offers two types of business loan financing. While the company doesn’t provide much information about potential repayment rates and terms before qualifying for funding, it does provide basic information to help decide which option might be best for your situation.
Working Capital Loans
Available for businesses operating for as little as six months and for owners with credit scores as low as 600, working capital loans from National Funding can supply up to $500,000 in as little as 24 hours after approval.
Working capital loan terms require daily, weekly, or monthly payments, depending on the loan specifics. Factor-rate repayment terms apply for working capital loans, as do origination fees and late payment fees. Loan lengths range from four to 24 months, and only businesses with a minimum annual revenue of $250,000 can be approved.
Equipment Financing
Equipment financing through National Funding is available for businesses with a two-year minimum history and credit scores as low as 650. The maximum borrowing amount is $150,000, and loan terms include monthly payments for two to ten years.
Interest rates or their equivalent aren’t stated for equipment financing. Some customers report paying as little as 4.1% APR. However, according to our research, the company’s typical rates are higher than that. As with working capital loans, National Funding equipment financing approvals are limited to businesses with a $250,000 minimum annual revenue.
National Funding Ignite
National Funding aggressively markets its business financial products—Providing another reason to thoroughly understand your financing terms before committing. One of the company’s marketing methods is called National Funding Ignite. The program includes mailing Ignite Cards to potential customers. Applicants who receive an Ignite Card can input the card information into the company’s website to begin the loan application process with National Funding.
National Funding Reviews
National Funding reviews are primarily favorable. Customers enjoy the company’s ease of use, rapid response times, fast funding, and relaxed approval requirements—reviewers on Trustpilot rate National Funding 4.7 out of 5 stars. Trustpilot scores overall include 87% of consumers awarding the company 5 stars, while just 5% give it 2 stars or below.
The company’s Better Business Bureau rating is lower, at 1.63 stars. However, it holds an A+ grade with the organization.
5-star
“Quick easy professional. Explained all my options and got what I needed. Thank you.” – Trevor, Trustpilot
4-star
“Although I did not get a loan through National Funding, they were very responsive in following up and up front about what they could and couldn’t do. The best part was, on one of their follow-up calls, I spoke with M*** C***** , who referred me to a couple other lenders who could help. I think that speaks volumes of either the company, or M*** C***** as a loan officer. There was nothing to gain other than helping a fellow human and I sincerely appreciate that.” – J.P., Trustpilot
National Funding Reviews: Complaints
Despite mostly positive review scores, National Funding does receive its fair share of complaints. Customers who score the company with 2 stars or below cite aggressive sales tactics, lack of communication after loan origination, and undisclosed or high fees and rates.
2-stars
“Process is not bad , the term and rates are not good .
they also throw in an origination fee which is not disclosed up front and if you catch it they get rid of it .
Not as bad as KABBAGE but the shady switch tactics are not good.” – Savas, Trustpilot
Who is National Funding Best For?
National Funding reviews come from owners of many business types. However, many of them have in common the fact that they are new, small, or have had financial challenges to deal with. That said, National Funding caters best to young businesses and to owners with poor to fair credit scores and histories who aren’t eligible for more traditional financing.
New companies with revenue exceeding $250,000 yearly that don’t qualify for other lending can do well with National Funding. However, borrowers should use caution to avoid or plan for unexpected costs and fees and potentially stringent payback terms.
More established companies, or those with better-than-average credit scores will likely experience better rates and less rigid repayment terms through a more traditional lending institution.
National Funding Vs. the Credibly
National Funding and Credibly business loans have several similarities. Both companies offer rapid funding to business owners with less-than-perfect credit who may have been in business just a short time. Both companies also offer varying terms based on loan type and amounts.
However, important distinctions also exist. National Funding offers funding of up to $100,000 more than Credibly and offers significantly longer repayment terms for its working capital loans. However, Credibly is easier to qualify for than National Funding, requiring just three months in business and $180,000 in annual revenue, compared to National Funding’s 6-month and $250k requirements.
| National Funding | Credibly | |
| Rates | 1.1+ factor and nondisclosed | 1.11 factor and nondisclosed |
| Amounts | $5,000 – $500,000 | $5,000 – $400,000 |
| Terms | 4 – 60 months | 3 – 24 months |
| Minimum Credit Score | 600 | 500 |
| Minimum Business Age | 6 months | 3 months |
| Minimum Revenue | $250,000 | $180,000 |
Frequently Asked Questions
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Source
Image Sources: nationalfunding.com – trustpilot.com – x.com
Deane Biermeier
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