National Funding Review

Pros and cons.

Pros

• Quick online application
• Fast approvals and funding
• Early repayment discounts
• Will work with some non-profits

Cons

• Daily or weekly payments, unlike traditional loan products
• Potentially costly factor rates and fees
• Requires a minimum annual revenue of $250,000

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Loan offerings through National Funding.

National Funding tailors its loan offerings to fit a variety of small business needs, emphasizing flexibility and understanding of each business’s unique financial situation. Their primary products include working capital loans (revenue-based financing), short-term loans, and equipment financing. Each of these loan types is characterized by a simplified application process, competitive rates, and the absence of stringent collateral requirements, making them accessible even to businesses that might not qualify for traditional bank loans.

This review will mainly focus on National Funding’s revenue-based financing offering.

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Things to consider.

Fast approvals and funding.

National Funding’s quick speed to funding makes it an ideal choice for small businesses that require quick injections of capital to seize growth opportunities or manage unexpected expenses. Businesses can complete the application process online in just a few minutes, and upon approval, receive funds as soon as 24 hours. This quick turnaround is especially beneficial in today’s fast-paced business environment where delays in funding can result in missed opportunities. 

Daily or weekly repayments.

National Funding’s repayment structure for revenue-based financing includes a key distinction from traditional loans: it requires daily or weekly payments. This model can be advantageous for businesses with consistent cash flow, as it enables smaller, more manageable payments that don’t significantly impact monthly financial planning. However, for businesses with fluctuating income, this repayment schedule could pose challenges, particularly during slower periods.

It’s crucial for potential borrowers to assess their cash flow patterns and ensure they can meet the frequent repayment requirements before proceeding with this type of funding. This consideration helps prevent financial strain and supports sustained business growth.

Early repayment discounts.

National Funding’s early repayment discount feature is particularly appealing for businesses aiming to manage their debt efficiently and reduce overall borrowing costs. If you pay back your working capital loan in full within the first 100 days, you’ll score a 7% discount.

By settling your loan ahead of the agreed term, you not only achieve peace of mind but potentially save a significant amount in interest and fees. This policy encourages prudent financial management and rewards businesses for their fiscal responsibility.

Typical fees for revenue-based financing.

Understanding the fees associated with revenue-based financing is crucial for any business considering National Funding as a financing solution. Generally, instead of traditional interest rates, revenue-based loans use factor rates to determine the total amount a business will pay back. These rates vary depending on the creditworthiness of the business, the amount borrowed, and the term length.

National Funding’s factor rate starts at 1.1. Origination fees include 2.5% on the first loan, 1.25% on the second loan, and 0% on the third loan.

By carefully considering these costs, businesses can better assess the overall affordability of a loan from National Funding and ensure it aligns with their financial strategy and cash flow capabilities.

High minimum annual revenue requirement.

National Funding sets a relatively high bar for potential borrowers with its $250,000 minimum annual revenue requirement. This criterion is designed to ensure that only businesses with a proven track record of generating substantial income can qualify for financing, which, in turn, helps mitigate the lender’s risk. While this threshold serves as a safeguard for the lender, it also means that smaller businesses or those in early stages of growth might find it challenging to access funding through National Funding.

Businesses contemplating National Funding should evaluate their financial statements to confirm they meet this criterion before applying. It’s crucial to consider this requirement in light of your overall financial health and funding needs. For companies close to the threshold, it might be worth exploring other financing options that cater to smaller or younger businesses with more lenient revenue requirements. This approach can ensure that you choose a financing solution that aligns with your business’s current stage and growth objectives.

Excellent third-party reviews.

National Funding has an excellent 4.8 out of 5-star rating on Trustpilot. It sports more than 1,800 reviews, 87% of which are “excellent.” Most excellent reviews mention the professional, helpful representatives, and fast funding. National Funding also earned an A+ rating from the Better Business Bureau.

Evaluation

National Funding is best for:

Whether you’re looking to overcome a temporary cash-flow challenge, expand your operations, or invest in new equipment, National Funding offers a compelling suite of products tailored to meet these needs. Businesses with the following needs can benefit from financing from National Funding:

• Businesses in need of quick capital. For companies looking to bridge short-term financial gaps or seize immediate growth opportunities, National Funding’s fast funding times are a major advantage. The ability to receive funds within 24 hours post-approval can be pivotal for businesses in rapid growth phases or those facing unexpected expenses.
• Businesses with strong daily or weekly cash flows. Given the daily or weekly repayment structure of National Funding’s loans, businesses that have consistent and predictable revenue streams stand to benefit the most. This type of repayment schedule fits well with companies that make regular sales, such as retail stores or restaurants.
• Businesses planning for early loan repayment. Those with the intent and ability to repay their loans ahead of schedule will find the early repayment discounts offered by National Funding attractive. It’s an excellent opportunity for businesses looking to manage their debts smartly by reducing the total cost of borrowing.
• Businesses valuing customer service and reputation. Companies that prioritize working with lenders that have a strong reputation for customer service and reliability will appreciate National Funding’s high ratings on Trustpilot and its A+ rating from the Better Business Bureau. These accolades suggest a high level of customer satisfaction and trustworthiness.

Where National Funding might fall short:

While National Funding presents a powerful solution for many small businesses in search of flexible financing options, it’s essential to weigh both its advantages and potential drawbacks. Here are business types where National Funding shines and areas where businesses might find it less than ideal for their specific needs:

• Businesses with lower credit scores. While National Funding requires a minimum credit score of 600, businesses on the lower end of this spectrum may face higher factor rates and fees.
• Businesses with seasonal cash flows. The daily or weekly repayment structure may not be suitable for businesses experiencing significant fluctuations in cash flow, especially those in seasonal industries. These businesses might find the frequent repayment schedule challenging during off-peak periods, leading to cash flow strains.
• Businesses seeking long-term financing solutions. National Funding specializes in short-term loans, which may not align with the needs of companies looking for longer-term financing options to support extended projects or long-term growth strategies.
• Businesses adverse to high costs. The potential for high factor rates and fees, especially for those with quicker funding needs, may deter businesses sensitive to borrowing costs. Businesses need to weigh the speed and convenience of National Funding’s products against the total cost of borrowing.

How to apply for financing from National Funding through Lendio.

Applying for financing through National Funding via Lendio is a streamlined process designed to connect your business with the funding it needs with minimal hassle. Lendio is a small business loan marketplace with multiple lenders that will help match small businesses with loans that suit their unique needs. Here’s how you can get started:

1. Complete Lendio’s online application form: You will need to fill out a brief online application on Lendio’s website. The form asks for basic information about your business, such as its name, how long it’s been in operation, your monthly revenue, and the amount you’re looking to borrow.
2. Documentation submission: Alongside your application, you will be asked to submit documents that verify your business’s financial standing. These could include recent bank statements, income statements, balance sheets, and tax returns. Having these documents ready in advance can speed up the process.
3. Review and acceptance: Once your application is submitted, Lendio will match you with potential lenders that fit your needs. If National Funding is a good fit for your financing requirements, you will receive an offer outlining the terms of the loan. Review these terms carefully to ensure they align with your business goals and repayment capabilities.
4. Finalize the deal: If you decide to proceed with National Funding, you will work directly with their team to finalize the loan details. This may involve additional verification steps or documents.

The bottom line.

For those businesses that align with National Funding’s requirements—particularly those in urgent need of capital, with steady cash flows, and a focus on customer service excellence—this lender represents a valuable partner in growth.

Nonetheless, it’s paramount for businesses to conduct a thorough analysis of their financial health, cash flow predictability, and long-term funding needs before committing. With a careful examination of the terms, fees, and repayment structures, businesses can make informed decisions that propel their objectives forward while maintaining financial stability.

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