Businesses sometimes face the dilemma of needing funding to grow but not yet big enough to qualify for traditional financing. This issue is an even more significant challenge for small businesses in low-income or underserved communities.
Lendistry is an online lending platform specifically designed for businesses in this situation. Its loan products and eligibility are intended for companies that are overqualified for alternative lenders but underqualified for traditional lenders. It also specializes in community development by supporting businesses in underserved areas.
The lender provides a convenient online application with fast approval and funding times. As part of its commitment to responsible lending, it sets limits on interest rates.
There are many attractive qualities to Lendistry, but it’s not right for every business or situation. This review covers the pros, cons, application process, and more to help you decide if a Lendistry loan is a good fit for your business.
Specifically, we’ll answer these questions and more:
Lendistry is a California-based Community Development Financial Institution (CDFI) that specializes in funding businesses in underserved communities. The minority-led small business lender provides various business loans and helps business owners with grant programs.
CDFIs are nonprofit lenders that are usually either banks or credit unions. Lendistry is a member of the Federal Home Loan Bank of San Francisco but is technically a non-bank lender. Most CDFI’s only serve a local or specific geographic area, but Lendistry provides lending services nationwide.
In many ways, the lender combines traditional brick-and-mortar lending with the speed and convenience of an online lender. Small business owners benefit from a human underwriting process with responsible lending practices, such as setting limits on interest rates. You also get a convenient online application with fast approval and funding times.
Per the Lendistry website, the CDFI seeks to help small businesses grow into medium and medium businesses grow into big businesses. In addition to its loan programs, Lendistry offers assistance with business grants and a business owner education platform.
Here are the small business loans that Lendistry offers.
Term loans are traditional business loans where you receive a large sum upfront and repay it plus interest in fixed payments. Borrowing amounts are between $50,000 – $5 million. Terms go up five years. Business owners can use the funds for various purposes, including working capital, refinancing debt, etc.
Lendistry’s non-revolving lines of credit are between $50,000- $5 million with terms of up to two years. A line of credit gives businesses a credit limit, and they can draw funds as needed. It’s short-term, flexible financing that provides funding only when you need it. A non-revolving line means the credit limit doesn’t replenish as you pay off what you owe.
The company’s commercial real estate (CRE) term loan provides funding to purchase a commercial building or property. The loan amount ranges between $50,000 – $5 million, with terms between 10 and 25 years. Lendistry’s CRE term loan is not a part of their SBA loan offering, which can also finance real estate acquisition.
Eligible properties include but are not limited to:
Lendistry is a non-bank lender participating in the SBA 7(a) loan program. SBA 7(a) loans are the most common and versatile loan in the SBA program.
Qualified business owners can get up to $5 million with an SBA 7(a) loan. Terms go up to 25 years for real estate and 10 years for all other purposes. Businesses can use the funds for working capital, purchasing inventory or equipment, expanding locations, refinancing business debt, and more.
The startup financing term loan is available for startups and businesses younger than two years. Amounts range from $50,000 – $1 million, with terms of up to 10 years. Business owners can use the funds for various purposes.
As a Community Development Financial Institution, Lendistry offers specialized programs to help underserved communities.
Here are some additional small business loans:
The qualifications depend on which small business loan you’re applying for. Most of their products require at least two years in business, except for their startup loan options.
The lender won’t accept applicants who had a bankruptcy in the previous three years or defaulted on government debt. The lender does not publish minimum annual revenue.
Here are the minimum personal credit score requirements by loan type:
The lender is mainly intended for established businesses that are still growing and can’t qualify for traditional financing yet. Their programs are designed to help those businesses bridge the gap from where they are to where they need to be for conventional lenders.
The qualifications are more stringent than most alternative lenders but looser than most conventional lenders, such as banks and credit unions. In particular, the loan programs are intended for minority and women business owners or businesses in low-income communities.
Like all lending products, the amount you qualify for, your terms, and your interest rate depend on your credit profile. However, as a CDFI, Lendistry takes measures to help keep costs, especially for business owners in low-income or underserved communities.
All Lendistry interest rates are an APR and start at 6%. The lender sets a limit on interest rates and won’t go over a 16% APR. By comparison, some alternative lending products carry factor rates with equivalent APRs up to 100%.
The lender also seeks to help business owners with educational resources and assistance in applying for grant programs. The company serves as an administrator, selected partner, or intermediary for several grant programs in California and New York.
California grant programs:
New York business grant programs:
Lendistry does not publish information about whether or not it runs an ISO affiliate program. Brokers must contact the lender directly to see if they accept broker clients.
Follow these steps to apply for a Lendistry business loan.
You can apply online or call the lender to apply over the phone.
You must provide documentation during the application process. The documentation requirements are slightly different for startups and established businesses.
Established businesses must provide the following:
Startups must provide the following:
Since it operates with online applications, you can usually get a decision within 24-48 hours. SBA loans will likely take longer, up to several weeks.
If approved, you can receive your loan proceeds in your business bank account within 24-72 hours. SBA loans will take several weeks.
Your repayment schedule will be weekly or monthly, depending on the loan type, terms, and credit profile. The lender sets up automatic payments that will deduct from your business bank account or credit card sales.
It does not publish information on its renewal process. All their loans use an APR, so you can save money by paying off what you owe early.
Lendistry provides low-cost financing options for businesses in underserved communities. It helps keep costs down by capping the interest rate you’ll be charged.
The CDFI lender blends traditional lending and underwriting practices with the speed and agility of online lending. As such, the tech-forward company can approve loans within a few business days and fund approved loans in 24-72 hours, SBA loans notwithstanding.
Like all CDFI organizations, Lendistry helps businesses in low-income areas receive funding. Companies in these areas often have trouble getting approved because lenders consider them high-risk.
Unlike most CDFIs that only serve a specific region, the lender provides funding in all 50 states. The qualifications are typically lower than most traditional banks and credit unions.
Since the lender mainly focuses on businesses in underserved communities, companies outside those areas are prioritized less. While the company’s qualifications are lower than traditional lenders, they’re still typically higher than most online and alternative lenders.
The lender provides a lot of helpful information on its site, but getting exact costs in terms of interest rates and fees can be difficult. It can also be challenging to know if you qualify before applying.
Despite providing many of the conveniences of online lenders, it does not offer the same products. Many bad credit business loan programs designed by alternative lenders are unavailable with Lendistry.
Pros:
Cons:
Yes, Lendistry is a legitimate lending platform and Community Development Financial Institution. It’s been accredited by the Better Business Bureau since 2018, with a B rating and a 4.68 out of 5 rating on more than 1,298 reviews. The company has helped businesses access over $9 billion in loans and grants and supported over 610,000 businesses.
The lender has a mix of good and bad reviews. We should note that many reviews occurred during the COVID-19 pandemic and related to PPP loans or COVID recovery loans and grants.
The positive reviews talk about how helpful the company was in assisting them with the loan or grant process. Many business owners discuss the knowledge and customer service of the Lendistry team.
Negative reviews and complaints talk about the difficulty of getting PPP loan funds or the time it takes for an SBA loan application. Some people complained about funds being sent to the wrong account.
Lendistry qualifications are between traditional and online lender eligibility requirements. As such, it can be challenging to identify if you have the credit score, time in business, or annual revenue necessary for approval. In addition, the lender serves businesses in underserved communities, and you might get denied if you are not in one.
If you applied for a loan and were declined, the denial letter should explain why. If it doesn’t, or you need more information, you can contact the lender directly.
Fortunately, there are plenty of online lending options if the CDFI denied you or you don’t think it’s a good fit. You should be able to find a lender for the following:
Lendistry is an excellent option for small businesses in underserved areas that need business funding. Its qualifications are more stringent than most online lenders, but the costs are low if you qualify.
Businesses with bad credit or those outside low-income communities might need to find a different lender. You could also find more advantageous lending with a traditional bank or credit union if you have a great credit score, established business history, and robust revenue.
Based on the loan products, interest rates, and customer reviews, we rate Lendistry at 4.25 out of 5. The lender is certainly worth considering, but the lack of transparency on their website makes it difficult to compare with other lenders.
Disclaimer: The Lendistry trademark is owned by B.S.D. Capital, Inc. dba Lendistry and its use herein is for reference purposes only and it does not indicate sponsorship or endorsement from B.S.D. Capital, Inc. dba Lendistry.
Fraud Disclosure:
Please be aware that individuals have been fraudulently misrepresenting to business owners (and others) that United Capital Source, Inc. (“UCS”) can assist small businesses in receiving government grants and other forgivable business loans, when in fact those grants or loans do not exist or are not available. These individuals have ulterior motives and are engaging in the unauthorized use of the names, trademarks, domain names, and logos of UCS in an attempt to commit fraud upon unsuspecting small business owners.
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