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Read More Jan 8, 2021 Filed under: Business Loans
ReadyCap Lending Review
Through ReadyCap Lending, small business owners and entrepreneurs can access affordable, long-term SBA loans to start or expand their businesses.
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Expert Analyst & Reviewer
UPDATED
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ReadyCap Lending
| Total Rating | 4.0 |
|---|---|
| Terms & Fees | Excellent |
| Application Process | Fair |
| Sales & Advertising Transparency | Good |
| Customer Service | Good |
| User Reviews | Fair |
Pros
- High borrowing amounts
- Rates tend to be inexpensive
- Few extra fees
- Long-term financing options available
- Financing is suited for small businesses
Cons
- The application process can be time-consuming
ReadyCap Lending Overview
ReadyCap Lending is a non-bank lender that specializes in helping small business owners receive affordable loans with low rates, longer terms, and more flexibility than other options on the market today. ReadyCap has secured more than $3 billion in capital to small businesses around the country.
ReadyCap Lending specializes in Small Business Administration loans. This subsidiary of Ready Capital is an SBA Preferred Lender. Small business owners who work with ReadyCap Lending can apply for the SBA 7(a) and 504 loan programs, which are affordable alternatives to bank or credit union loans.
Table of Contents
Services Offered
ReadyCap Lending provides low-cost, long-term SBA loans for starting, operating, or expanding your small business with anywhere between $350,000 to $5 million:
- SBA 7(a) Loans: Through the 7(a) program, you can use your funds for almost any business purpose, including purchasing or refinancing commercial real estate, consolidating high-interest debt, acquiring a business, buying a franchise, purchasing equipment, or funding startup costs.
- SBA 504 Loans: With a 504 loan, you can receive up to 50% of financing for your project. A Certified Development Company (CDC) will fund 40% of project costs, leaving you with as little as 10% to pay. Proceeds from 504 loans can be used to purchase land or existing commercial buildings, finance construction or renovation costs, or buy fixed equipment for your business.
Borrower Qualifications
ReadyCap Lending does not provide all borrower requirements for its loans directly on its website. However, the lender states that the debt service coverage ratio (DSCR) for its SBA loans should be 1.15 to 1.30, depending on how loan proceeds will be used and the borrower’s industry. Learn more about calculating DSCR and how lenders use it.
Additional borrower qualifications are available from the SBA. The SBA sets basic requirements for its loan programs, and this information is readily available on the association’s website, which can be accessed via ReadyCap Lending’s site.
Learn more about the requirements for each program below.
7(a) Loan Program
To qualify for the SBA 7(a) loan program, you must meet the following requirements:
- Qualify as a small business based on SBA size standards
- Be a for-profit business
- Must use loan funds for business purposes
- A credit score of 680 or above
In addition to your personal credit score, your credit history will be evaluated. Your credit report should be free of liens, bankruptcies, foreclosures, and defaults on government-backed loans.
Collateral may be required to secure your loan. Business assets typically serve as collateral. However, personal real estate or property may be used as collateral if you fall short. It’s also important to note that the SBA will not turn down applications solely based on a lack of collateral, provided the borrower meets all other requirements.
504 Loan Program
To qualify for the 504 loan program, your business must meet the following requirements:
- Have a net worth of $15 million or less
- Have an average net income of $5 million or less after federal taxes for the two years prior to applying
- Be a for-profit business
- Have a credit score of 680 or above
Similar to 7(a) loans, your credit report should be free of any potential red flags — foreclosures, bankruptcies, or past defaults.
With 504 loans, you must also find a CDC willing to fund 40% of the project costs.
For this type of loan, a down payment may be required. Typically, you’ll only pay 10% of the total project costs, but you may be required to pay as much as 30%. No additional collateral is usually needed, as the real estate, land, or equipment that is financed serves as the collateral.
Additional requirements may need to be met to receive a loan through ReadyCap Lending. To learn more about borrower requirements, you can request a quote or submit an inquiry through the company’s website.
Unsure of which loan is best for you? Check out SBA 504 VS 7(a) Loans: Which Is Right For Your Small Business?
Terms & Fees
ReadyCap Lending does not provide much information about SBA loan terms and fees on its website, but you can find most of this information on the SBA’s website.
Some general things to know about ReadyCap SBA loans are that amounts of $350,000 to $5 million are available, with repayment terms of up to 25 years. Equity injections of 0% to 20% are required. Up to 100% financing is available, depending on how proceeds will be used and your industry.
One of the best things about SBA loans is that maximum rates are set by the SBA, keeping them affordable for small business owners. Take a look at the loan rates for SBA 7(a) and 504 loans for current interest rates.
SBA partners such as ReadyCap may also charge their own fees, such as closing costs, referral fees, packaging fees, or others. All fees, interest rates, and terms can be discussed with a professional at ReadyCap Lending.
Application Process
To start the application process with ReadyCap Lending, you can submit a quote request through the company’s website. You need to provide a small amount of personal information on the request form, including your name, email address, phone number, city, and state. You can also type a message on this form to provide additional details of your request.
Once you’ve submitted your request, a representative will contact you to discuss the financial products that may be a good fit for your business. If you decide to move forward with a loan, you’ll receive more details on the application process, qualification requirements, and documentation needed to complete your loan request.
Sales & Advertising Transparency
ReadyCap Lending is about average when it comes to sales and advertising transparency. The company does provide some basic information about its loans, including the types of loans available, how funds can be used, maximum borrowing limits, and some borrower requirements.
ReadyCap’s website does not fully disclose all interest rates, fees, and borrower qualifications for its loans. However, it links to the SBA website, which provides a great deal of information and resources for small business owners new to SBA loans.
Customer Service & Technical Support
Prospective and current customers can contact ReadyCap Lending through its website, which has separate secure forms for requesting quotes and general inquiries.
Its parent company, Ready Capital, is also on social media and shares current news and updates through its Facebook, Twitter, Instagram, and LinkedIn profiles.
ReadyCap Lending User Reviews
ReadyCap has very mixed online reviews, though most of them have to do with the company’s participation in the now-defunct Paycheck Protection Program (PPP). Most fintech lenders were not equipped or prepared to handle the massive demand for PPP loans in 2020 and 2021. Therefore, PPP-related complaints about an online lender aren’t necessarily reflective of that lender’s quality as a whole.
Based on 970+ Trustpilot reviews, ReadyCap’s parent company Ready Capital LLC has received a rating of 3.8/5 stars. The business is not BBB accredited.
Negative Reviews & Complaints
ReadyCap’s negative reviews primarily have to do with the following issues:
- PPP Loans Never Funded: There are a number of negative ReadyCap reviews surrounding problems faced when applying for or receiving a PPP loan through ReadyCap. While some reviews had to do with being rejected by ReadyCap for a PPP loan, an alarming number of businesses complained that ReadyCap approved them for a PPP loan but then never sent the funds. Sadly, more than one reviewer stated they would more than likely lose their business due to this mixup.
- Poor Customer Service: ReadyCap customer service reps have been described as rude and unresponsive, particularly regarding problems with PPP loans.
Positive Reviews & Testimonials
There are also positive reviews online for ReadyCap Lending. ReadyCap Lending also has customer testimonials on its website. Overall, customers are pleased with:
- Helpful Customer Service: In contrast to the negative reviews complaining about the quality of customer service, some ReadyCap reviewers said they experienced kind and helpful customer service agents.
- Smooth, Easy Funding Process: Some reviewers said they experienced a fast and efficient loan approval, aided by ReadyCap’s simplification of the SBA loan application process.
Final Verdict: Is ReadyCap Lending Right For You?
Small business owners having difficulties navigating SBA loans can make the process easier by working with an SBA Preferred Lender such as ReadyCap Lending. Through ReadyCap Lending, small business owners and entrepreneurs can access affordable, long-term SBA loans to start or expand their businesses.
ReadyCap Lending’s online information is lacking in some ways — for example, there is no online application, documentation checklists, or lists of fees or borrower requirements. However, the company has a proven track record of securing billions in SBA funding for small businesses over the past decade.
ReadyCap Lending FAQs
Shannon Vissers
Expert Analyst & Reviewer at Merchant Maverick
The former editor-in-chief of SteelOrbis, Shannon has been researching and writing about small business software and financing since 2015. Her shopping and retail expertise has been cited in numerous publications, including Reader's Digest, MSN, Yahoo Finance, and GOBankingRates . She has also published articles for LIVESTRONG.COM, eHow, Life'd, and other websites. Shannon attended San Diego State University, graduating in 2005 with a BA in English.
View Shannon Vissers's professional experience on LinkedIn.
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Did you ever receive your funds?
This comment refers to an earlier version of this review and may be outdated.
Organization Name: LightHouse Sober Living LLC
SBA got me in contact with you on a small business loan we are looking into. Right now we are just a sober living program and want to expand the business and contract with insurance to help more patients with drug and alcohol addiction. We have been in business for 2 1/2 years and my wife and I have 6 years experience in the field . We already have a business account and fully license in Hardin County Kentucky. We both work in treatment. I am a Admission coordinator at Recovery works and my wife is the program manager for the women’s IOP program at The commitment House LLC. We want to expand and work together in our own business , bring our combine knowledge of treating addiction together and help others. We already have employee that are onboard to joint with us.
This comment refers to an earlier version of this review and may be outdated.
Organization Name: Ivy Bend Resort
I have signed and returned all required documents TWICE! It has been 2 weeks since I received notification I was to receive the funds I applied for within 10 days! I would like to know the Status of my Application at this time. I was given a Loan Confirmation number and notified the funds were being dispersed. ????????
This comment refers to an earlier version of this review and may be outdated.
Did you ever receive your funds?
This comment refers to an earlier version of this review and may be outdated.