Guidant Financial Review
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- Date Established
- 2003
- Location
- Bellevue, WA
Pros
- Financing is available to qualified startups
- Multiple types of financing available
- Rates tend to be inexpensive
- Monthly repayments
- Website advertising is clear and informative
Cons
- The application process can be slow
- Funds can take a while to disburse
- Customer service is inconsistent
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 401(k)s and similar accounts to be used for startup costs without incurring tax penalties. The company also offers SBA loans and lines of credit. Its wide range of products makes Guidant suitable for many types of small businesses, from new entrepreneurs starting a business in their retirement to franchisees to established businesses looking for a low-interest SBA loan. You can borrow as little as $10K or as much as $5 million. Or if you choose the ROBS option, you won’t have to borrow any money at all — you can just use the funds from your retirement account.
Guidant’s transparency and solid rates make it quite competitive, but it suffers from some complaints regarding the responsiveness and knowledgeability of its customer service. Guidant also requires applicants to have good credit, which may put this lender’s products out of reach for some small businesses. Those who don’t make the cut may want to check out some alternatives.
Table of Contents
Services Offered
Guidant Financial offers the following business financing products:
Guidant is perhaps best known for its ROBS plan, which restructures your retirement account to allow you to use those funds to start a business without facing the usual tax penalty for withdrawing your retirement funds early. You will have to pay Guidant a setup fee and monthly maintenance fee, however.
In addition to retirement account business financing, Guidant is also a potential source of franchise financing via its SBA Working Capital Loan, long-term SBA loans for large investments, and modest lines of credit for any type of business.
Guidant’s loans and retirement account funding offer the benefits of straightforward terms and reasonable fees. If you have good credit and meet Guidant’s other qualifications (see Borrower Qualifications below), you can apply for financing on Guidant’s website and get pre-approved quickly. After that, you’ll have to submit more documentation for the underwriting process. It can take a few weeks for funding to come through — or a few months if you’re applying for an SBA loan.
Borrower Qualifications
These are the qualifications for getting an unsecured loan (line of credit) from Guidant Financial:
| Time In Business: | N/A |
| Credit Score: | 690 |
| Credit Utilization: | Less than 50% |
Additionally, Guidant likes to see the following:
- No recent derogatory marks on your credit report
- Minimal credit inquiries
These are the qualifications for getting an SBA 7(a) loan from Guidant:
| Time In Business: | N/A |
| Credit Score: | 690 |
| Credit Utilization: | N/A |
These loans require a 20% down payment for an existing business and a 30% down payment for a startup business.
Additionally, Guidant likes to see the following:
- Industry experience
- Secondary income
Guidant also offers an SBA Working Capital Loan program for new businesses seeking $150,000 or less. This product has no personal collateral requirements. Its qualifications are slightly different, however:
| Time In Business: | N/A |
| Credit Score: | 690 |
| SBA Score: | 160 |
| Credit Utilization: | 40% debt-to-income ratio |
| Additional Requirements: | Minimum 10% equity injection & an additional $25,000 in liquidity (can be from ROBS) |
In addition to a 10% down payment, Guidant will also want to see the following:
- Paid franchise fee before funding (if applicable)
- Business must be able to begin operations before funding
- No recent bankruptcies
These are the qualifications for getting a portfolio loan from Guidant:
| Time In Business: | Unknown |
| Credit Score: | N/A |
| Asset Requirements: | Over $85,000 in securities & stocks trading at more than $5 per share |
These are the qualifications for getting a ROBS from Guidant:
| Time In Business: | N/A |
| Credit Score: | N/A |
| Asset Requirements: | $50,000 or more in eligible & rollable retirement assets |
Terms & Fees
Rating: Excellent
Guidant Financial’s terms and fees are both straightforward and fair. Guidant offers clear terms, low-interest rates (compared to other alternative lenders), and monthly repayments.
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:
| Borrowing Amount: | $10,000-$150,000 |
| Term Length: | Revolving |
| Interest Rate: | 12%-18% (0% introductory rate for some clients for the first year) |
| Origination Fee: | 9% |
| APR: | Learn more |
| Collateral: | None |
Guidant is known for its ROBS, but the lender also provides unsecured loans for businesses. Despite their name, these loans have revolving terms similar to those of a line of credit. That means you can draw on 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 that 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 portfolio loans:
| Borrowing Amount: | Up to 80% of your account balance Minimum $85,000 |
| Term Length: | Revolving |
| Fixed-Rate: | 3%-4% of the borrowing amount |
| Origination Fee: | 2% |
| APR: | Learn more |
| Collateral: | Your portfolio |
Portfolio loans allow you to leverage the value of your stocks and securities to obtain funding without actually selling them. Think of it as using your portfolio as collateral for a secured loan. Otherwise, Guidant’s portfolio loans work similarly to its 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.
SBA 7(a) Loans
| Borrowing Amount: | $150,000-$5 million |
| Term Length: | Up to 10 years |
| Fixed-Rate: | See current SBA loan rates |
| Origination Fee: | 3%-5% of loan amount + SBA Guaranty Fee (closing costs, including SBA Guaranty Fee); loans under $200K without ROBS funding may be subject to an additional fee |
| APR: | Learn more |
| Collateral: | Personal guarantee |
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 or 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 $25,000 in reserve cash. In exchange, this version lets you avoid collateral requirements, replacing them instead with first liens on your business assets. It also features a simplified, faster application.
SBA Working Capital Loans
| Borrowing Amount: | $75,000-$150,000 |
| Term Length: | 7-10 years |
| Fixed-Rate: | See current SBA loan rates |
| Origination Fee: | 1%-3% of loan amount + SBA Guaranty Fee (closing costs, including SBA Guaranty Fee); loans under $200K without ROBS funding may be subject to an additional fee |
| APR: | Learn more |
| Collateral: | Business assets |
SBA Working Capital Loans are smaller, expedited versions of more traditional SBA loans such as 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 its ROBS product to cover the down payment of an SBA Working Capital Loan. The down payment is typically around 10% 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
| Borrowing Amount: | Up to 100% of the account balance Minimum $40,000 |
| Term Length: | N/A |
| Setup Fee: | $4,995 |
| Administration Fee: | $139 per month |
Have you heard of a ROBS before?
When you’re first starting 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 (such as 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 do a rollover of funds from the following types of retirement accounts:
- 403(b)
- Traditional IRA
- Thrift Savings Plan
- Simplified Employee Pension
- Keogh
Application Process
You can see if you prequalify 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 Guidant approves you:
- Unsecured Loans: three to four weeks
- Portfolio Loans: two to three weeks
- SBA Loan: two to four months
- SBA Working Capital: 30 to 60 days
- ROBS: three weeks
Sales & Advertising Transparency
Rating: Excellent
Guidant provides most of the information you’ll need on its website. You’ll find information about rates, products, term lengths, and qualifications.
You can also dig around in Guidant’s resource center for general information about lending.
Customer Service & Technical Support
You can reach Guidant by phone or through the lender’s website (email). Guidant is reachable over the phone Monday through Friday from 7 AM-5 PM Pacific Time. There is no live chat option, but you will receive a dedicated Account Manager.
Guidant also has useful support resources on its website, with an online learning center that includes guides, videos, financing calculators, and more.
Reviews of Guidant’s customer service are mixed, with the primary complaint seeming to be difficulty reaching staff.
User Reviews
Guidant Financial currently has an A+ rating with the BBB and some positive reviews regarding its products and particularly its ROBS plan. However, Guidant also has a fair amount of complaints, particularly about its customer service.
Negative Reviews & Complaints
Guidant has three reviews on its BBB profile — all 1-star reviews. There are also some negative reviews on its Yelp page. Common customer complaints include:
- Uneven Customer Service: Several 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 funds to you. 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 its products upfront.
Final Verdict
Guidant Financial is best known for its ROBS plans, which, while niche, can be a good option for entrepreneurs who need funding to get a new business off the ground. Guidant also provides an easier way to get an SBA loan to finance your franchise or independently-owned small business. Terms and fees are fair and clearly stated on Guidant’s website. However, caveats include longer times to funding compared to other online SMB lenders and somewhat iffy customer service. More mature businesses with good or excellent credit may be interested in the convenience offered by Guidant, although if you qualify for this lender’s 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.
Chris Motola
Finance Writer at Merchant Maverick
Chris Motola is a writer, programmer, game designer, and product of NY. These days he's mostly writing about financial products, but in a past life he wrote about health care and business. He's a graduate of the University of Central Florida.
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