Guidant Financial Review

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Pros

• Appropriate for new businesses
• Good rates

Cons

• High credit requirements
• Slower than most other alternative lenders

Overview

Guidant Financial is an alternative lender based in Bellevue, Washington. Guidant specializes in a financial product called Rollovers as Business Startups (ROBS) which allows funds from 401Ks and similar accounts to be used for startup costs without incurring tax penalties. They also offer SBA loans and lines of credit.

Guidant’s transparency and solid rates make them quite competitive, but high credit requirements may put this lender’s products out of reach of many small businesses. Those who don’t make the cut may want to check out some alternatives.

Services Offered

Guidant Financial offers the following products:

• Line of credit loans
• SBA loans
• Rollovers as Business Startups (ROBS)

Borrower Qualifications

These are the qualifications for getting an unsecured loan (line of credit) from Guidant Financial:

These are the qualifications for getting an SBA loan from Guidant:

For SBA Working Capital Loans, you must have begun operations prior to funding.

Guidant also offers an SBA 7(a) program for new businesses seeking $150,000 or less that has no personal collateral requirements. Its qualifications are slightly different, however:

These are the qualifications for getting a portfolio loan from Guidant:

These are the qualifications for getting a ROBS from Guidant:

Terms & Fees

Lines Of Credit

Unsecured Loans

These are the rates and fees for Guidant Financial’s unsecured loans, which function similarly to a line of credit:

Guidant is known for their ROBS, but they do also provide unsecured loans for business. Despite their name, these loans have revolving terms similar to those of a line of credit. That means you can draw upon your credit as frequently as you want so long as the total amount you’ve borrowed does not exceed your credit limit. As you pay off your balance, you’ll free up additional credit you can use again.

Payments on Guidant’s unsecured loans are made monthly. If you qualify for the introductory offer, you won’t have to pay interest for the first 12 months.

Portfolio Loans

These are the rates and fees for Guidant Financial’s unsecured loans, which function similarly to a line of credit:

Portfolio loans allow you to leverage the value of your stocks and securities to obtain funding without actually selling them. Think of it like using your portfolio as collateral for a secured loan. Otherwise, Guidant’s portfolio loans work similarly to their unsecured loans, except you’ll be charged interest-only payments monthly. The interest rate, as well as the setup fee, are also lower than they are with the unsecured loans, but there’s no introductory rate.

SBA Loans

Guidant offers two types of SBA loans. SBA loans are partially guaranteed by the Small Business Administration (SBA), which allows businesses to access better rates and terms than they would otherwise qualify for. The tradeoff is a more complex and longer application process.

The SBA 7(a) program is the most popular and versatile of the SBA’s loan programs. SBA 7(a) loans can be used for everything from refinancing debt to purchasing land, to purchasing equipment, to expanding an existing business.

This SBA loan is otherwise similar to other installment loans. You’ll make monthly payments (principal + interest) until the loan is paid off completely.

Guidant offers a variation on the 7(a) loan for customers seeking $150,000 or less. The credit requirements are a little higher (see above), and you’ll also need to have at least $25K in reserve cash. In exchange, this version lets you avoid collateral requirements, replacing them instead with a first lien on business assets. It also features a simplified, and faster, application.

SBA Working Capital Loans

SBA Working Capital Loans are smaller, expedited versions of more traditional SBA loans like the 7(a). Keep in mind that we’re talking fast for an SBA loan — figure somewhere around 45 days.

Interestingly, Guidant allows these loans to work in conjunction with their ROBS product to cover the downpayment of an SBA Working Capital Loan. The downpayment is typically around 10 percent of the loan. Note that if you’re funding a franchise, you have to have paid the franchise fee in advance of applying.

Rollovers As Business Startups

Have you heard of a ROBS before?

When you’re first starting out as an entrepreneur, getting that initial funding with no business history can be an enormous hurdle. One alternative to a loan is to rollover funds from a retirement account (like a 401(k)). Technically, you’re not borrowing money at all.

So why wouldn’t you just liquidate the account instead? A ROBS doesn’t qualify as cashing out your retirement account, so you won’t be hit with the penalties that come with liquidating a retirement account early. As a “rollover,” the funds aren’t taxable.

Guidant allows you to rollover funds from the following types of accounts:

• 401(k)
• 403(b)
• Traditional IRA
• Thrift Savings Plan
• Simplified Employee Pension
• Keogh

Application Process

You can see if you pre-qualify on Guidant’s website with a simplified form that promises results within a few minutes.

The actual funding process, however, takes significantly longer. You’ll need to submit a copy of your credit report when you apply for any of Guidant’s products.

If you’re applying for an SBA loan, you’ll also need a number of additional documents, including:

• Necessary SBA forms
• Three years of federal personal tax returns
• Resume
• Personal identification
• Business plan
• Financial projections
• Info on any affiliated businesses you may have

Otherwise, your contact at Guidant will walk you through any product-specific documents you may also need to provide.

Here’s about how long it’ll take to get funding if you’re approved by Guidant:

• Unsecured loans: 3 weeks
• Portfolio loans: 2 -3 weeks
• SBA Loan: 2 – 4 months
• SBA Working Capital: 30 days
• ROBS: 3 weeks

Sales & Advertising Transparency

Guidant provides most of the information you’ll need on their website. You’ll find information about rates, products, term lengths, and qualifications.

You can also dig around their resource center for general information about lending.

Customer Service & Technical Support

You can reach Guidant by phone or through their website.

Reviews of Guidant’s customer service are scarce and mixed, with the primary complaint seeming to be difficulty reaching staff.

Negative Reviews & Complaints

Guidant Financial currently has an A+ rating with the BBB. While you can find customer reviews of Guidant, there aren’t a ton of them. Customer complaints include:

• Uneven Customer Service: A number of customers complained about not being able to reach their customer rep.
• Speed Issues: Compared to most other online options, it will take Guidant longer to get you your funds. Additionally, some customers complained about the funding process taking even longer than advertised.
• Other Communication Issues: A few customers complained about confusion with the funding process or being surprised by unexpected fees.

Positive Reviews & Testimonials

Guidant also garners its fair share of praise from reviewers:

• Good Rates: Guidant has competitive rates if you qualify.
• Wide Range Of Products: From portfolio loans, to ROBS, to revolving lines of credit, to SBA loans, you should be able to find something that fits your needs.
• Transparent: Guidant provides a lot of information on their products up front.

Final Verdict

Guidant Financial is best known for their ROBS plans which, while niche, can be a good option for entrepreneurs who need funding to get a new business off the ground. More mature businesses with excellent credit may be interested in the convenience offered by Guidant, although if you qualify for their products, you probably also qualify for a traditional bank loan.

Didn’t find what you were looking for here? Can’t meet Guidant’s credit requirements? Not all lenders require a credit check. Entrepreneurs looking for funds may also want to consider these alternatives.