Fora Financial Business Loans review
1.13 to 1.40
$5,000 to $1,500,000
6 months
$240,000
Pros and cons of Fora Financial
| Pros | Cons |
|---|---|
Large loan amounts Works with low-credit borrowers Fast funding Short business history requirement Potential early payoff discount Doesn’t run a hard credit check until funding | Only two funding options Expensive origination fee Factor rate makes it hard to compare loan costs Doesn’t help build business credit |
Fora Financial small business loans review
Established in 2008, Fora Financial is an online lender that directly approves and funds two small business lending options, short-term business loans and revenue advances. Both products provide between $5,000 to $1,500,000 for working capital purposes, such as payroll, supplies, marketing, equipment and more. Approvals take around four hours, with funds available within 24 to 48 hours.
Fora Financial‘s factor rate can make it hard to compare against lenders advertising interest and annual percentage rates — it’s best to convert rates in advance to ensure you understand the full cost of borrowing. Still, the good news is that you may be eligible for a discount if you repay your Fora Financial loan early.
Note that Fora Financial may refer applicants to third-party partners, which offer additional types of small business financing. In this case, Fora Financial acts like a business loan broker, ensuring the partner lender has all relevant info to process your application. However, your interest rate, term length and loan amount are determined by the partner lender, who will service your account and collect payments. If the account is eligible for renewal, Fora Financial can help facilitate a new loan on your behalf.
Overall, Fora Financial has good ratings, with 4.4 out of 5 stars on TrustPilot and an A+ rating with the Better Business Bureau. Customers say that Fora Financial representatives have gone above and beyond with helping meet their business needs, although some have complained about the daily payments required with the revenue advances.
Who is Fora Financial for?
- Business owners with limited credit. Fora Financial accepts credit scores as low as 570, making it a great choice for businesses needing a bad credit business loan.
- Early-stage startups. While many lenders require your business to operate for one to three years before you’re eligible for funding, Fora Financial only requires a six-month business history — making it one of our top picks for best startup business loans.
- Companies needing quick access to funds. If you need a fast business loan, Fora Financial can process and fund your loan within 24 to 48 hours after approval.
Fora Financial small business financing at a glance
| Product | Loan amounts | Repayment term | Estimated factor rate | Fees |
|---|---|---|---|---|
| Term loan | $5,000 to $1,500,000 | 4 to 18 months | 1.13 to 1.40 | Origination fee: 3.00% of loan amountWire transfer fee: Amount unspecified |
| Revenue advance | $5,000 to $1,500,000 | Varies based on sales volume | 1.13 to 1.40 | Origination fee: 3.00% of loan amountWire transfer fee: Amount unspecified |
Term loans
You can borrow up to $1,500,000 with a short-term business loan from Fora Financial, with repayment terms ranging from 4 to 18 months. Funds can be used for practically any type of startup business costs or ongoing expense. However, you can’t use your Fora Financial business loan to buy another business.
Be aware that Fora Financial charges a factor rate instead of a traditional business loan interest rate, making it hard to compare the total loan cost with other financing options. It’s worth converting the factor rate in advance to see how much a Fora Financial term loan could cost you.
For example, if you borrow $20,000 for a 12-month term with a 1.3 factor rate, your converted interest rate would be 30%. In comparison, the average interest rate for a business term loan is 7.98%.
Fora also offers early payback provisions — this means that if you pay back your loan early, it can drop the factor rate you pay down as low as 1.1
Revenue advance
Fora Financial’s revenue advance is similar to a merchant cash advance, which gives you a cash advance based on your daily debit or credit card sales. The key difference is that payments for a revenue advance are based on your total sales volume and deducted from your business checking account.
The revenue advance’s funding limits and factor rate are similar to its small business term loan, but with weekly or even daily payments instead of predetermined, fixed monthly payments. This gives small business owners more flexibility in scaling payments to match their sales, which can help during times of seasonal dips in income. However, a revenue advance could be a strain on your business budget, since you won’t be able to predict how much you’ll owe each week.
Fora Financial borrower requirements
| Minimum annual revenue | $240,000 |
| Minimum time in business | 6 months |
| Minimum credit score | 570 |
Fora Financial has lenient business loan requirements compared to traditional bank business loans. Recently established businesses can qualify as long as you’ve been in operation for at least six months and generate a monthly income of at least $20,000. While Fora Financial accepts poor credit scores as low as 570, having a higher credit score can help unlock more favorable rates and terms.
You may be able to borrow between 75% to 125% of your monthly gross sales amount, depending on your business’s qualifications.
Required documents
If you’re ready to apply for a business loan with Fora Financial, you can submit the easy online application and a funding specialist will reach out to discuss options. While Fora Financial doesn’t list the specific documents you’ll need, gathering the following paperwork can help speed along the process:
- Recent business bank account statements
- Your latest business tax return
- A current profit and loss (P&L) statement and/or a balance sheet
- A detailed business plan to help show how you plan to use the funds
- Collateral information, if needed
Alternatives to Fora Financial
| Fora Financial | PayPal | OnDeck | |
|---|---|---|---|
| Minimum credit score | 570 |
| 625 |
| Loan products offered |
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|
|
| Time to funding | 24 to 48 hours |
| Same business day |
| Starting rates | 1.13 factor rate | Fixed-rate fee (amount not disclosed) | 31.30% APR Minimum APR offered to at least 5% of customers (not the lowest rate offered) |
| Maximum loan size | $1,500,000 | $200,000 (up to $300,000 for repeat borrowers) | $250,000 |
| Minimum annual revenue | $240,000 |
| $100,000 |
| Minimum time in business | 6 months |
| 12 months |
Fora Financial vs. PayPal
If you already use a PayPal Business or Premier account for your business payment processing needs, the PayPal Working Capital loan can help you tackle short-term projects and everyday expenses. As with Fora Financial’s revenue advance loan, PayPal adjusts your repayment based on your incoming sales volume until your debt is repaid.
Since PayPal has a direct link to your income stream, you’ll be able to access funds faster than most lenders — with funds available in as little as minutes. Loan amounts only go up to $300,000 (or $200,000 if this is your first PayPal loan), which is a far cry from Fora Financial’s $1,500,000.
Yet, PayPal could be a good option if your business doesn’t meet Fora Financial’s high minimum annual revenue requirement of $240,000. With PayPal, your business only needs to generate $15,000 to $20,000 per year, based on your PayPal account type. And the best part? There’s no credit check for PayPal’s working capital loan.
If you’re looking for a loan with fixed weekly payments, PayPal also offers a term loan with amounts up to $150,000, though your business needs to be at least nine months old to qualify.
Note that PayPal business loans aren’t available in North Dakota and South Dakota.
Fora Financial vs. OnDeck
OnDeck is another alternative lender offering same-day business funding with lenient eligibility criteria and flexible repayment terms. Although OnDeck requires a higher credit score (625 versus 570) and a longer business history (12 months versus 6 months) to qualify, its annual revenue requirement is $140,000 less than Fora Financial’s — making it a better choice for low-revenue companies.
If you want access to a large business loan, Fora Financial is the way to go with up to $1,500,000 in funds. That said, OnDeck offers a business line of credit, allowing you to borrow up to $100,000 in flexible funds on an as-needed basis — only paying interest on withdrawn amounts.
OnDeck’s interest rates tend to run high, starting at a 31.30% APR Minimum APR offered to at least 5% of customers (not the lowest rate offered) for term loans. However, it’s hard to accurately compare these rates to Fora Financial, since it lists a factor rate range instead of interest or APR. Your best bet is to apply to both and see which lender offers the better deal — just make sure to convert factor rates to APR to accurately compare each offer.