Need help finding a loan?
- Date Established
- New York, NY
- Suited for small businesses and startups
- Low-interest rates
- No borrower qualifications
- No credit score requirements
- 2% facilitator fee
- No live chat support
Lendoor is part of a new trend in the peer-to-peer lending world — in fact, this company sees itself as less of a lender and more of a “crowdlending” platform. Taking advantage of new SEC regulations spurred by the passage of the JOBS Act in 2012 (which loosened rules governing who can participate in crowdfunded startup lending), Lendoor synthesizes the concepts of P2P lending and crowdfunding. With Lendoor, instead of seeking funds from a pool of anonymous donors (as you would with other P2P lending platforms), you launch your own social media campaign (through your existing channels) to solicit funding from friends, family, customers, and associates.
So why would you involve Lendoor in this instead of just soliciting your acquaintances directly? Lendoor states the following in its FAQ:
We save you time and money by providing a simple fundraising process, a formal contract between you and your lenders, and an easy-to-use automated repayment system.
Essentially, Lendoor is akin to Kickstarter, except instead of connecting you to donors who send you money in exchange for a promise of future rewards, Lendoor facilitates loans between you and those in your personal and professional networks — people who already know and trust you.
Lendoor’s loans are installment loans. The borrower is sent the full loan immediately upon approval, then pays down the principal, plus interest, on a fixed monthly schedule.
Read on to learn more about Lendoor’s unique crowdlending platform.
Table of Contents
Lendoor facilitates crowdfunded loans of between $5K and $50K that can be used for funding a start-up business.
The requirements for using Lendoor’s platform are lenient, to say the least:
|Time In Business:||N/A|
In order to launch your own Lendoor campaign, the following conditions must be met:
- You must be at least 18 years old
- Your loan campaign must pertain to a business venture
Obviously, you’re more likely to achieve your funding goal if you provide a thorough accounting of yourself and your business in your loan campaign. But in order to participate in Lendoor’s platform, all you need is a business venture. Lendoor will not check your credit score.
Terms & Fees
These are the terms and fees for Lendoor’s crowdfunded loans:
|Borrowing Amount:||$5K – $50K|
|Term Length:||six months – three years|
|Interest Rate:||0% – 8%|
When launching your loan campaign, you set the three primary terms of your loan: amount, term to maturity, and interest rate. You can set a term length of six months, one year, two years, or three years. Although Lendoor’s home page says you can set a term of just three months, when I created an account and examined the fields in a loan campaign, the shortest term available to choose was six months.
Likewise, you can set the interest rate anywhere from 0% to 8% in increments of a quarter-percent. Once you’ve launched your campaign, you have 30 days in which to secure your loan target amount. If (and only if) you reach your target amount, the loan will be automatically closed, and you will receive your funds within five to six business days on average. There’s also a facilitator fee of 2% and a loan service fee of 50 cents per month per lender, capped at $25 per month.
Other short-term loan options if Lendoor doesn’t work for you:
|Lender||Borrowing Amount||Term||Req. Time in Business||Min. Credit Score||Next Steps|
|$5K - $500K||3 - 36 months||x1.003 - x1.04/mo||12 months||600||Apply Now|
|$5K - $500K||13 - 52 weeks||x1.029 - x1.1872||9 months||550||Apply Now|
|$5K – $300K||6, 9, 12, 15, or 18 months||x1.15 – x1.31||1 year||600||Apply Now|
|$2K - $5M||Varies||As low as 2%||6 months||550||Apply Now|
Lendoor holds particular appeal for entrepreneurs with bad credit, as your ability to secure a loan is based entirely on the merits of your startup venture, as judged by those who already know you — not by a random loan officer somewhere.
Signing up for Lendoor is incredibly simple. I did it in about a minute. Just go to Lendoor’s home page, pick the terms you want for your desired loan (loan amount, term, and interest rate), enter a name for your loan campaign, and enter your name, email address, username, and password. Poof, you’re in!
Once you’ve set up your Lendoor account, you can fill in the details of the loan campaign that you began on the home page as well as start a new loan campaign. When setting up your campaign, you summarize your pitch and describe (in dollar amounts) just what you’re going to be spending the loan proceeds on. The amount detailed must equal the total amount of the loan.
Beyond that, you just have to give some basic personal information (nothing about your credit score/history). You also have the option of uploading up to 10 documents (business plans, presentations, etc.) to append to your pitch.
Think of this as the sales pitch for the loan campaign you’re going to present to your contacts. It’s not really intended for the benefit of Lendoor. The only vetting they’ll be doing is to verify that your business venture appears to exist. They leave the due diligence to the lenders, who should be familiar with you already.
Sales & Advertising Transparency
Lendoor’s FAQ covers just about every aspect of the lending process for both lenders and borrowers. As Lendoor is an intermediary platform and is not itself a lender, there’s not a great deal for them to disclose beyond the fact that it’s integrated with banking software provider SynapsePay for handling all money transfers.
Customer Service & Technical Support
For customer support, Lendoor provides a phone number (available 9 AM – 5 PM CST) and an email address. There is no live chat support.
Negative Reviews & Complaints
I searched high and low for feedback from both professional reviewers and individual users of Lendoor’s platform. However, I came up empty. Despite being written up in the New York Times as they were getting ready to launch their services, they haven’t attracted much attention as of yet.
Positive Reviews & Testimonials
Again, I’ve been unable to find any feedback concerning Lendoor, positive or negative. If anybody reading this has had any experiences with the company, please drop us a line and let us know how it went! We’d love to hear from you!
Lendoor’s concept — providing an intermediary platform for people to pitch a loan campaign to their network of contacts — is certainly an intriguing one. Entrepreneurs seeking to raise funds for their business project may well wonder, however, why they shouldn’t just try regular crowdfunding a la Kickstarter. Lendoor may be an option worth considering if the people in your network are open to funding your venture but require a greater return on their investment than they would get with crowdfunding.
Likewise, you may wonder why those seeking a loan from their personal and professional networks wouldn’t just seek such a loan directly. If you have a rich relative already willing to lend you all the money you need, you’d have a strong point. However, Lendoor is counting on you being willing to cut them in on the action in return for the value they provide in the form of a streamlined fundraising process, a simple automated repayment system, and a formal lending contract. If your network contains people who wouldn’t have the ability or inclination to give you an entire loan themselves but who would be willing to come together to help fund such a loan, Lendoor may be worth exploring.
Of course, you should evaluate your own personal situation and business needs before deciding if Lendoor’s crowdlending loan platform makes sense as an option for you.
Other start-up business loan options:
To learn more about how we score our reviews, see our Business Loan Rating Criteria.