Headway Capital Review
Need help finding a lender?
- Chicago, IL
- No credit score requirements
- Suitable for small business
- High APR
- Some additional fees
Headway Capital is part of Enova International, a financial services company based in Chicago. The parent company owns a number of lending services around the world, including two others in the United States: CashNetUSA, a payday lending service, and Net Credit, a personal lending service. Headway Capital is Enova’s first foray into the world of business finance. Since then, the company has acquired a second business lending service.
Much like its competitors OnDeck, BlueVine, and StreetShares, Headway Capital offers standard lines of credit to young but established businesses that do not yet have access to other, often less expensive, forms of financing.
There are a lot of things to like about Headway Capital’s service — customer service is friendly and transparent, borrower qualifications are low, term lengths are long, and lines of credit are just really convenient products. However, Headway Capital’s APRs range from 40% to 80%, which is very high, even when compared to those of their closest competitors.
Read on for the details.
Table of Contents
Headway Capital offers business lines of credit to qualified merchants.
These are the minimum qualifications required to get a loan from Headway Capital:
|Time In Business:||one year|
In addition, Headway Capital currently lends to businesses in 36 states: Alabama, Arizona, California, Colorado, Delaware, Florida, Georgia, Idaho, Illinois, Iowa, Indiana, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Minnesota, Mississippi, Missouri, Nebraska, New Hampshire, New Jersey, New Mexico, New York, North Carolina, Oklahoma, Pennsylvania, South Carolina, Tennessee, Texas, Utah, Virginia, Washington, Wisconsin, and Wyoming.
Headway Capital does not have a hard cutoff for credit scores. Be aware that Headway Capital does check your personal and business credit; however, the company bases its decision to let you borrow on many other factors aside from your score. You may still be eligible for financing even if you have sub-par credit, or you may be declined for reasons apart from your scores.
Terms & Fees
|Credit Line:||$5K – $100K|
|Term Length:||12, 18, or 24 months|
|Interest Rate:||3.33% – 6% per month|
|Draw Fee:||0% OR 2% per draw (depending on the state)|
Headway Capital’s credit lines currently cap at $100K, though the amount you will personally be offered depends upon your annual revenue, creditworthiness, and other business factors. Somewhat unusual for this type of lender, your terms may vary significantly depending on the state you live in. In fact, I’d go so far as to say that where you live will largely dictate how good a deal Headway Capital is.
Minimum and maximum credit line sizes also vary by state. More importantly, your state will determine whether or not there’s a 2% draw fee every time you draw upon your line of credit (the states that don’t have this fee are: Colorado, Georgia, Indiana, New Jersey, and Oklahoma). Finally, your state also determines the minimum amount you must take out with your first withdrawal. Check Headway Capital’s site to see the terms for your particular state.
You can draw from your line at any time during your term length, and you only have to pay interest and fees on the outstanding amount.
Interest rates range from 3.33% – 6% per month or about 0.83% – 1.5% per week. Repayments are made on a weekly or monthly basis over the course of either 12, 18, or 24 months. You can repay early at any time without penalty and save money on interest.
Headway Capital’s application is done entirely online.
To apply, all you need to do is fill out an application via the website. Headway Capital will ask for information about you, your business, and your bank. At this point, the company will run a soft credit check, which won’t affect your credit score. Headway Capital will use all this information to determine whether or not you’re eligible to continue with the funding process.
If so, the company will offer you an estimated quote, including a maximum credit line and an interest rate. You can use this information to decide whether you’d like to continue on the process but be aware that your quote may change after an underwriter looks at your information.
If you choose to continue, you’ll have to submit documentation, including your three most recent monthly bank statements. According to the FAQ, you might also have to provide other documentation, including:
- Corporate tax returns
- Personal tax returns
- Profit and loss statements
An underwriter will assess your information to ensure everything is in order and make the final decision regarding your maximum credit line and interest rate. The underwriters will run a hard credit check at this point, which will affect your score.
Assuming everything checks out, Headway Capital will offer you a credit line and corresponding interest rate. If you agree to the terms and sign the contract, you will be able to start drawing funds from your line.
The time from application to funding normally only takes a few days.
Sales & Advertising Transparency
Headway Capital’s website is not misleading, and they provide a fair amount of information about how their product works and who might be eligible to borrow capital. You may have to dig around for some information, but to be fair, the terms of their product do vary substantially from state to state.
The only thing keeping them from an “excellent” rating here is that the monthly interest system they use can create the impression that Headway Capital’s rates are lower than they actually are.
Customer Service & Technical Support
Customer service is available via phone or email. Phone service is available Monday – Friday, 8:30 AM – 6 PM CT. Most people are happy with this company’s customer support — in fact, many customers cite the service as one of the high points of working with Headway Capital. In my experience, the customer service is friendly, knowledgeable, and transparent.
The website also has a FAQ that may provide useful information to new customers.
Headway Capital has a BBB profile, but the company is not currently accredited. Headway Capital currently rates an A- on the site for failing to respond to a customer complaint. The combined rating from their two user reviews on the BBB is a 3/5.
On Trustpilot, where reviews tend to be more positive, they have an aggregated rating of 8.9/10 and around 158 total reviews.
Negative Reviews & Complaints
Here is what customers don’t like about the service:
- Draw Fee: In most states, Headway Capital charges a 2% fee every time you draw from your line. This is not unusual, but depending on how you use your account, these fees can add up quickly.
- Expensive Borrowing Fees: Headway Capital’s APRs range from 40% – 80%, which is high compared to other, similar services. Be sure that you understand your personal APR and make some comparisons to other services before accepting an offer from Headway Capital.
- Credit Line Changes: Headway Capital reserves the right to adjust the amount of credit available to you during periodic reviews of your account.
Positive Reviews & Testimonials
The largest source of positive reviews is Headway Capital’s Trustpilot page. Here is what customers liked about this service:
- Fast Application Process: You can get your funding as soon as the next business day if everything goes well.
- Friendly Customer Service: Most customers were satisfied with the care they received from Headway Capital staff.
- Convenient Revolving Credit Loans: Lines of credit can traditionally be one of the harder financial products to qualify for. Headway Capital makes it easier for businesses to access them.
Do you have experience with Headway Capital? Good or bad? Leave a message in the comments below!
Headway Capital might be convenient for merchants who need a small credit line to capitalize on business opportunities or other working capital needs. The service is now available in most states and has increased the maximum size of their credit line up to $100K, which should be an adequate credit line for most small business needs.
This lender has a lot of competitors, however, and many offer lower interest rates, smaller fees, and/or access to more capital. If you’re eligible for Headway Capital, you are likely also eligible for other lines of products. As for Headway Capital itself, the pesky 2% draw fee is really the difference of a half-star rating. If you live in Colorado, Georgia, Indiana, New Jersey, or Oklahoma, you’re just going to have a better experience with Headway Capital than you would in any other state. Consider them a 4/5 alternative lender in those states and a 3.5/5 elsewhere.
That said, there’s no particular reason to avoid Headway Capital if the company happens to offer you the best deal.
To learn more about how we score our reviews, see our Business Loan Rating Criteria.