OnDeck began offering loans to small businesses in 2007. Since their founding, they have lent over $7 billion to over 700 industries. Today, OnDeck is one of the top sources for business term loans and business lines of credit.
In addition to having a generally positive reputation among borrowers, OnDeck was part of the Fortune 50 Best Small and Medium Companies to Work For in 2016. Many people who have taken out business loans with OnDeck have left positive reviews for OnDeck at the bottom of this page.
- Easy Application
- Low Requirements
- Fast Access to Cash
- Prepayment Benefits
- Customer Service Experience
OnDeck makes applying for a business loan quick and straightforward. Business owners simply upload qualifying documents to OnDeck and wait 1-3 business days to hear if they have been approved. Business owners can also apply over the phone, but will need to send their qualifying documents at a later time.
OnDeck's requirements are transparent and comparatively minimal. Banks and many other alternative lenders typically do not consider customers with a personal credit score of 500. Most of these lenders also require your business to be at least two years old. The average borrower has been in business for about seven years and exceeds roughly $450k/year in gross revenue. Lower qualification requirements open the door for more business owners to receive critical funding and grow their business.
OnDeck clearly outlines the exact minimum qualifications your business needs to meet before you apply for a loan:
- 500 personal FICO score
- One year in business
- $100k in annual revenue
- Established in the United States and Canada
Fast Access to Cash
Business owners looking for fast access to cash will find it with OnDeck; they can provide funding in as little as 24 hours. Small businesses can generally fill out the online application within 10 minutes, and owners will know if they have been approved in as fast as one day. OnDeck will loan you about 15 percent of your annual revenue at a time, but that can fluctuate based on credit scores and other factors.
OnDeck offers a prepayment benefit waving up to 25 percent of the remaining interest if a loan is paid off early.
Customer Service Experience
OnDeck gives you the option to apply and checkout entirely online, but they have dedicated Loan Specialists to walk you through the application process and Customer Service Representatives to answer questions or resolve issues six days a week. Further, the company has a Customer Success team whose purpose is to ensure its customers' voices are heard and acted upon.
Learn more about OnDeck
- Rates are Higher than Banks
- Personal Guarantee
Rates are Higher than Banks
Compared to banks and some other alternative lenders, OnDeck has high borrowing rates. With OnDeck, the AIR for term loans start at 9.99% with an average of 23.6% simple interest and 49.7% AIR as of June 1, 2017. For this reason, when we calculated the cents on the dollar for a $100k loan over 12 months, we took the average interest rate we found (23.6 percent) to prepare business owners for the worst case scenario. However, they stand behind their claim to be transparent. The company's SMARTBOX rate comparison tool allows small businesses to understand and assess the costs of their finance options.
When you take out a loan with OnDeck, they place a general lien on your business's assets and require a personal guarantee for the loan. While we agree that a general lien on your business's assets protects both the borrower and the lender, a personal guarantee is a concern.
Finally, OnDeck financing charges an origination fee, although they are upfront about it. Check their website for more specifics on their current fees.
The Bottom Line
OnDeck is a good alternative lending source for small businesses that do not qualify for an SBA or bank loan. It will be difficult for you to find a company that is more upfront about their loans. If you meet the minimum application requirements, we strongly recommend you consider OnDeck for a business loan. The company makes applying for a loan easy, has flexible term lengths and amounts, and reasonable qualification requirements. See if you qualify.