National Funding Review
- Low credit score requirements
- Discounts for repaying early
- No collateral required
- The application process is fast and easy
- Funds are disbursed quickly
- Rates can be expensive
- Some additional fees charged
- Repayments are required frequently
- Misleading website advertising
National Funding is a California-based company that provides funding to small businesses that cannot yet get a bank loan. Like many of its competitors, you won’t have to worry about collateral or having good credit.
On the other hand, you’ll be diving head-first into the breakneck-speed world of online business funding and merchant cash advances. This type of financing requires you to pay back a portion of your loan or advance each day, so the rates can be quite punishing. Before diving into the world of MCAs, we first encourage you to take a look at our short-term funding comparison chart and make sure you don’t qualify for better rates.
Table of Contents
National Funding provides short-term financial products in the form of merchant cash advances and short-term business loans. While the legal and technical details of these products differ, from the client’s perspective, both feature flat fees instead of interest rates and involve making daily repayments over a relatively short period, usually less than a year. In the case of a merchant cash advance, you’ll be paying a percentage of your daily credit card sales, while with a short-term loan, you’ll be making fixed daily payments.
National Funding offers fast, though expensive, business funding. Businesses with poor credit ratings can still qualify. Companies such as National Funding are usually more concerned with the amount of money you’re making in revenue than with your credit history.
To qualify for funding, you must meet these prerequisites:
|Time In Business:||12 months|
|Credit Score:||500 (to qualify for a loan)|
|Revenue:||$100,000 per year|
|Average Bank Balance:||$1,500|
|Other:||$3,000 per month in credit card sales (to qualify for a merchant cash advance)|
National Funding also requires no bankruptcies within the last year.
Terms & Fees
National Funding’s website is fairly lean on details. Below, you’ll find the range of offers you can probably expect from this company:
|Borrowing Amount:||Up to $250,000 (for a merchant cash advances)
$5,000-$500,000 (for a business loan)
|Term Length:||6-15 months|
|Borrowing Fee:||One-time fee of 17%-36% of the borrowing amount|
|Origination Fee:||2% of the borrowing amount|
|Effective APR:||Learn more|
National Funding, like most of its competitors, uses a fixed-fee structure. Instead of paying interest, you will be charged a one-time fee that is based on a percentage of the borrowing amount. You will repay this fee along with the loan. In the case of National Funding, the fee typically falls between 17%-36% of the amount you borrow. You should also expect to pay around 2% of the amount borrowed in origination fees.
All National products are unsecured, meaning no specific collateral is necessary. You will, however, need to sign a personal guarantee, which means the funder can go after your personal assets if you default on your loans.
Whether you get a loan or an advance, you’ll be making payments daily. In the former case, you’ll be making a fixed daily debit (though you may be able to get weekly terms on some products) via an automated clearing house (ACH). Cash advances are paid by holding back a percentage of your daily credit card revenue. There’s no fixed repayment term length in the latter case, as your repayments will fluctuate along with your cash flow. However, if all goes well, National Funding cash advances are typically designed to be repaid within 15 months.
National Funding offers early payoff discounts. If you pay off your balance (in full) early, you’ll receive a 7% discount. You can take advantage of this offer at any time during your term.
Overall, National Funding’s rates are nothing to write home about, falling well within typical ranges for an online lender; you could do worse, but you could also do better. The early payment discount is the highlight here, for those who can swing it.
One of the bigger selling points of alternative funders such as National Funding is the fast and simple application process.
You can begin your application online, or you can call sales directly to get things underway. Sales reps are easy enough to reach, so you can probably skip the online portion if you want to. You’ll need to have three months of bank statements handy to prove your income, a voided business check, and a copy of your driver’s license.
If all goes well, you can have your funding directly deposited into your account within a business day.
Sales & Advertising Transparency
National Funding’s sales and web presence are par for the course for non-traditional lenders. You’ll find some general information about the products National offers, such as the amount you can apply to borrow, but it’s not particularly useful for comparison shopping. More frustratingly, the site implies a greater breadth of products that National Funding offers. Unfortunately, this is a fairly common thing in the online lending market, either because the lender will hand your application off to a funder within their network that does offer the product, or because the information is presented simply for reference. Either way, it causes unnecessary confusion.
Customer Service & Technical Support
Reaching National Funding’s sales staff is easy and painless, but I didn’t find my discussions with staff to be very informative so far as gathering information goes.
The majority of user reviews that address customer service are positive, however, so you may have a better experience when you’re a paying customer.
You can reach National Funding by phone, through its website, or on Facebook, Twitter, or LinkedIn.
As is often the case when it comes to lenders, National Funding’s user reviews are highly polarized, with customers coming away with strong positive or negative assessments of the company.
National Funding maintains an A+ rating with the BBB, indicating that it does tend to respond to complaints in a timely manner. The average review rating for National Funding, however, is a 2 out of 5.
Negative Reviews & Complaints
Complaints about National Funding tend to fall into the following categories:
- Qualifying Can Be Difficult: Some customers complained that they received preapproval notices from National Funding but ended up not being qualified after going through the application process.
- Expensive: While National Funding’s business practices are well in line with the merchant cash advance and short-term loan industry in general, customers who don’t have much experience with them were shocked by the fees.
- Aggressive Sales Tactics: Several complaints involve unsolicited marketing calls and mailers from the company.
Positive Reviews & Testimonials
National Funding has a rating of 4.6 out of 5 on Trustpilot, with over 1,300 reviews. Customers who praised National Funding liked the following aspects:
- Poor Credit Okay: The credit prerequisites for MCAs are low, making it easy to qualify.
- Quick & Easy: Compared to traditional lenders, the application and approval processes are really easy.
- Easy Renewals: If you’re making your payments, you can easily get more funding from National.
National Funding is one of the older non-traditional lenders out there. The company has managed to retain a pretty positive reputation with its customers over the years. On the other hand, National plays its cards a bit too close to the chest, making it difficult for prospective customers to do critical comparison shopping for their funding. All in all, its rates are slightly on the high side for an alternative lender, but as long as you fall on the lower range of the company’s factor rates and origination fees, they’re not unreasonable.