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LendingClub Review

Friday, September 29th

2023 Business Loan Provider Reviews

LendingClub Review 2.5 Star Rating


2.5 Star Rating
  • Fixed-rate personal loans from $1000 to $40,000 for new/small businesses
  • Fixed-rate business loans from $5000 to $500,000 for businesses with at least $50,000 in annual sales and 12+ months in operation

LendingClub isn't the peer-to-peer platform it used to be (and the reason why "club" was in its name in the first place). Instead of relying on multiple lenders/investors to fund their borrowing requests, businesses can now take advantage of LendingClub's streamlined structure that is more like a regular bank.

Loan requirements for new businesses

You'll notice that there are two options there. If you're a new business, your loan would be structured as a personal loan. In that instance, you can expect to qualify for up to $40,000 and get a loan with APRs anywhere from 8.05% to 35.89% and a one-time origination fee of up to 6%. Your rates and terms will depend solely on your personal credit. That's a nice option to have, considering that some of LendingClub's competitors won't fund you at all unless you meet certain thresholds for annual profits and time in business. Personal loans through this institution are backed by WebBank, an "A+" rated and accredited company through the BBB.

Loan requirements for existing businesses

On the other hand, if you've been in operation for at least a year and have annual sales of at least $50,000, you're eligible to apply for a business loan through LendingClub. They partner with Accion Opportunity Fund for all of their business lending.

New processes application process

If you're applying for a personal loan through LendingClub, enter the requested loan amount (between $1,000 and $40,000) and select the loan's purpose in the dropdown box, then "Check Your Rate" . LendingClub will try to verify your credit history based on your name, address, and birthdate. You'll be asked for your Social Security Number if they can't locate your credit report with the other details. If LendingClub is able to offer you a personal loan to use for your business, you'll see all of the rates and terms on the next page.

Existing business application process

On the other hand, if you qualify to apply for a business loan, you'll start in the same way: entering the amount of loan you need (up to $500,000) and choosing the category that represents how you intend to use the funds (inventory purchase, marketing, remodeling, and so on). When you click on the "Get a Quote" button, you'll be redirected to the Opportunity Fund page - which, while carrying the LendingClub logo at the top, is no longer serviced by LendingClub itself.

Best Business Loan Providers

Still being re-evaluated by the BBB

LendingClub is still under evaluation by the BBB: because the company underwent such a major overhaul, it takes time to establish any patterns of customer complaints and responses from the business. That's all normal and not a reflection of any trustworthiness issues. Plus, LendingClub had an "A" rating prior to their restructuring.

Different reputations of backing lenders

We want to keep an eye on the different ratings of the lenders that back LendingClub's business loans. While WebBank, the partner for the personal loans required for smaller, less established businesses, has an "A+" from the BBB, Accion Opportunity Fund has a much less reassuring "B-" rating. That's not a good sign, considering that LendingClub essentially hands you off to them from the very start.

Too many unanswered questions

While we like LendingClub in general and are really encouraged to see lots of positive customer feedback coming through after the company's restructuring, we just don't feel very confident about how they're approaching business loans at this time. It's great that they have an option for newer businesses, but there are competitors who offer funding that doesn't require the sky-high interest rates of a personal loan to do it. Plus, with no servicing coming from LendingClub on actual business loans - just a transfer to Accion Opportunity Fund - we think there are plenty of other lenders out there that are more straightforward. We recommend looking at a higher-ranked financial institution for your business loan.

Who Offers the Best Business Loans?

With all the difficulties in today's economy, many people are choosing to open their own business instead of working for a traditional employer. Whether you're just starting your business, expanding your already-established business, or even hanging out a shingle as an online company, it's likely that at some point you'll need a business loan to successfully meet your customer's needs and your business goals.

In the past, small business owners relied heavily on traditional brick-and-mortar banks in order to finance their business loans. Often that meant that borrowers had to rely on their own reputation and relationship with their local bank. Getting the lowest possible interest rate was also more challenging, since there were few lending options from which to choose.

The Best Business Loan Providers Compare Business Loan Providers Compare Business Loan Provider Reviews What are the best Business Loan Providers Best Business Loan Provider Reviews

Business Loan Provider FAQ

Business loans are available for just about any need: equipment financing, merchant cash advances, working capital, and much more. While you'll have to provide details about your business to apply and qualify for a business loan, once you've received the funds you can usually use them for whatever your company needs.
There are several types of lenders when it comes to business loans. You could get funding through a traditional bank or credit union, either locally or online. There are also peer-to-peer lending platforms that allow smaller financial institutions and even private investors to fund business loans.
You'll definitely pay interest on your business loan. Rates typically range from 1.5% to as high as 36% APR. You may also have origination fees of up to 6% of the loan amount, depending on the lending partner you select.
That always depends on the lender. Some providers of business loans require you to have a certain length of time in business or a minimum amount of gross annual sales to even apply. It's a good idea to determine those requirements before you begin the application, to save yourself some time and hassle.
Most of the time, you can complete the entire business loan process, from application to funds transfer, 100% online. That's a huge convenience for busy business owners like you, who might be applying outside of traditional bank hours.
Most lenders offer business loans ranging from $2,000 to $500,000. The amount you're approved for will depend on the lender you select and your business situation: naturally, the longer you've been in business and the more profitable you've been, the more likely it is that you'll be approved for a large loan.
You should have the proceeds of your business loan in your account within a week. However, if you need the money sooner, look for a lender that offers next-business-day funding. And, keep in mind that those timeframes are based on when you accept the loan offer you get, not just when you finish the application. Your business loan may require extra verification steps, like documentation of income and expenses, before you receive a funding offer.
Any time you take out a loan, you run the risk of defaulting. Be sure to only borrow what you need and maybe a little extra, and have a clear plan for making on-time loan payments. Many providers of business loans offer education and counseling at no extra charge, if you could use help in determining how much to borrow and how to use the loan wisely to maintain and grow your company.
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Continued from above...

Fortunately, business owners today can choose among many lenders to find the best terms and interest rates available. In addition to the old local options, small business borrowers now have much more and better choices through various lenders on the Internet that specialize in small business loans.

There are many factors that you should consider before selecting a lender for your business loan. Some of these include:

  • Loan size and rate. How much will you be allowed to borrow? What interest rates do they typically offer on loans of that size?
  • Loan application process. When applying for your business loan, can it be completed online? Is the lending process easy and straightforward?
  • Requirements for business history. Can a brand-new business take out a loan, or is there a minimum time that the business must have been in operation in order to qualify? What other verification and/or collateral is required to secure the loan?
  • BBB rating. Does the lender have an established history of good business practices?

TopConsumerReviews.com has reviewed and ranked the best Business Loan programs available today. We hope this information helps you find the best loan for your small business at an affordable rate!

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