Founded in 2007, The Business Backer LLC offers small business loans and cash advances up to $200,000 and business lines of credit up to $100,000.
If you qualify, The Business Backer can be a good resource for fast short-term financing. The lender is willing to work with borrowers who only have moderate credit ratings. Also, The Business Backer is more transparent than many lenders in the industry. However, the company does charge higher fees than some lenders.
Consider The Business Backer if you:
- Need $100,000 to $200,000 in short-term financing fast
- Have been in business at least 1 year
- Are generating $180,000 or more in annual revenue
- Have a personal credit rating of 550 or more but can’t qualify for business loans at lower interest rates
Small Business Loan
The Business Backer offers small business loans with fixed sums borrowed up front and transparent repayment schedules.
The Business Backer loans feature:
- Amounts available up to $200,000
- Terms from 4 to 18 months
- Fixed monthly interest rates from 1.1% to 3.5%, averaging 2.2% monthly and 25.8% annualized
- Repayment frequencies available include daily, weekly and semi-monthly
- Early prepayments by customers in good standing earn 35% off unpaid interest
- If you refinance, The Business Backer discounts 100% of unpaid interest on your first loan and only rolls over your principal into your new loan, so that you don’t pay interest on your interest
- Origination fee of 3%
The Business Backer uses fixed interest loans. This means that your interest rate stays constant throughout the duration of your loan and doesn’t fluctuate with the discount rate as variable rate loans do.
Merchant Cash Advance
The Business Backer also offers merchant cash advances (MCAs), also known as business cash advances. Under this arrangement, The Business Backer lends you a cash advance against the strength of your projected future revenue, and you repay your debt by giving The Business Backer a percent of your future sales.
The Business Backer’s merchant cash advances feature:
- Amounts available up to $200,000
- Factor rates (rather than interest rates) starting at 12% of your borrowed amount
- Repayment options available include daily, weekly and semi-monthly payments
The Business Backer’s MCAs use factor rates rather than interest rates to calculate the amount you owe. Whereas periodic repayments based on interest rates can vary with the amount of principal you still owe, factor rates set a fixed flat fee that you have to repay on top of what you borrowed, expressed as a percentage or multiple of the amount.
The Business Backer’s cash advances start at a factor rate of 1.12, meaning you have to repay the amount you borrowed plus an additional 12%.
Line of Credit
The Business Backer further offers business lines of credit. The financing works similar to a credit card, giving you a revolving line of credit you can spend when you need it. The Business Backer lines of credit feature:
- Lines available from $5,000 to $100,000
- Financing from 1 to 2 years
- Annual percentage rates (APRs) starting at 18%
The Business Backer offers lines of credit in partnership with a network of lenders, and the actual terms of your credit arrangement vary depending on which lender issues your credit, as well as with the information on your application.
The Business Backer Lending Experience
The Business Backer lending process involves 3 major steps:
- Complete an application to see if you qualify
- Provide 3 months of recent bank statements and select an appropriate funding option
- Sign a contract agreement and receive your funds in as little as 24 hours
Your initial qualifying application generates a “soft pull” on your credit, meaning it doesn’t appear on your credit report and doesn’t affect your credit score. If you’re approved, you will be contacted by a representative of The Business Backer to continue the process. If you sign a contract, The Business Backer will do a “hard pull” on your credit that does appear on your credit report and that can affect your credit score.
In a best-case scenario, assuming that you have all your documentation for your application ready and that the approval process goes smoothly, you may receive your funds the same day. However, the process can sometimes take longer. Some customers have reported the application process taking weeks, according to one third-party reviewer.
Pros of The Business Backer
The Business Backer offers clients several major pros that make it a good lender to work with:
- Several funding options available for amounts up to $200,000
- Transparent pricing of interest fees and factor rates, which is unusual in the short-term financing industry
- Fast application and approval process
- Accessible customer support
- Willingness to work with business owners who have only moderate credit ratings or bankruptcy issues
- Most online reviews of The Business Backer by customers are positive
Cons of The Business Backer
The biggest con against The Business Backer is that its repayment terms are expensive:
- High interest and factor rates, typical of the short-term financing industry
- Other fees such as origination fees
Requirements for The Business Backer
To qualify for financing from The Business Backer, you generally need:
- Time in Business 1+ Years
- Annual Revenue $180,000+
- Personal Credit Score 550+
These are general guidelines that can vary with funding types. As long as you have been in business for at least 1 year and your annual revenue is at least $180,000, The Business Backer will begin the prequalification process. After that, other factors may be considered to determine if you qualify.
Additionally, The Business Backer loans are only available to business in certain states, including:
- New Hampshire
- South Carolina
What You Need to Apply
To apply for financing from The Business Backer, you need 3 months of recent bank statements, plus additional documents requested by your assigned adviser that can include:
- A government-issued form of identification such as a driver’s license
- Proof of business ownership, such as papers of incorporation or tax returns
- A voided business check
- Recent business financial statements, such as profit and loss statements
- Recent business tax returns
Final Say: The Business Backer Reviews
The Business Backer is an excellent resource for small business owners who need financing quickly or who only have moderate personal credit scores. The company’s transparency and customer service make it a good lender for small businesses.
However, their repayment terms are relatively high. Also, if you can qualify for lower payment options from other lenders, you should explore those opportunities first.