SmartBiz Review

Term Loan

As you evaluate your options for small business loans, take a close look at how SmartBiz term loans compare to other lenders. While they offer a platform of lenders to choose from, you can get an idea of the standard requirements and loan terms to expect before you apply. This gives you a basic understanding of what type of eligibility requirements your business must meet and how a typical loan agreement may be structured. 

Evaluation

SmartBiz stands out as a reputable lender platform that connects borrowers to term loan options. Higher loan amounts are available, and funding times are average for the industry. Credit score minimums aren’t quite as strict as some of the other eligibility requirements, but your business does need to have been around for at least 2 years, in order to apply. It’s also important to pay attention to funding fees that will likely reduce your total loan amount. 

Here’s everything you can expect from SmartBiz term loans.

Average Funding Times 

The SmartBiz lender network focuses on term loans with higher amounts to borrow. In fact, the minimum loan amount is $30,000, indicating that these loans are really designed for businesses with enough revenue to cover those higher monthly payments. 

On the other end of the spectrum, the maximum loan amount is $350,000. This isn’t huge, especially if you want to finance a major purchase with the loan. Compared to lenders that finance up to $5 million, SmartBiz is in the middle of the road when it comes to loan amounts. Consider your financial needs before proceeding with your application in order to get enough funding for your project.

Interest Rates and Fees

Interest rates start as low as Prime+ 2-4% with SmartBiz term loans. That’s competitive if you qualify for that lower end of the range. But there’s no indication of what the upper limit may be. As always, it’s smart to compare multiple loan offers to make sure you’re getting the best rate out there. 

Additionally, the amount of interest charged on the loan isn’t the only fee to watch out for with SmartBiz. Term loans also include a 3% referral fee and 3% package fee, which is deducted from the loan amount before the funds are disbursed. So if your business qualifies for a $200,000 loan, you’d actually receive only $188,000. Be sure to account for that loss when planning on how to use your loan funds. 

SmartBiz also offers a way to reduce your term loan interest rate by 2%. In order to qualify, you must agree to pay a 5% prepayment penalty if you end up paying off your loan balance early. That 5% would be charged on the outstanding balance rather than the original loan amount. 

If you decide to pay off the loan in full when you have a $25,000 balance, your prepayment fee (if you opted for the initial rate reduction) would be $1,250. Do the math to compare which option seems the most beneficial for your business.

Stricter Requirements to Get a Loan

SmartBiz doesn’t list all of their requirements to qualify for a term loan, which may mean there’s some flexibility based on your business. However, they do say that your company should be in good financial standing before applying—in other words, this isn’t meant to be a way to fund financial emergencies. 

Here’s what we do know about applying for a business loan through SmartBiz. First, the minimum credit score for a term loan is 660. That’s actually considered quite flexible in the industry, with average lenders generally requiring a minimum 700 credit score. 

However, your company does need to be in business for at least two years, which is on the stricter side for most lenders. There is no explicit monthly or annual revenue requirement listed by SmartBiz. But considering that the minimum term loan amount is $30,000, you’ll definitely need some established revenue in order to qualify.

Flexible repayment options

SmartBiz terms loans last anywhere between 2 and 5 years. Plus, borrowers enjoy fixed monthly payments over that timeframe, rather than being charged more frequently. This is a huge advantage, especially compared to some other lenders that require daily or weekly payments, which in turn put strain on your short-term cash flow. 

Additionally, since payments and interest are fixed, you can consistently track your budget over time. Some business financing options structure payments as a percentage of sales, which can hurt profit margins and your business’s overall health. SmartBiz’s lender network, instead, lets you independently manage your cash flow and cover your loan payments on a monthly basis.

Excellent Customer Reviews

SmartBiz reviews stand out when it comes to satisfied customers, earning an average 4.6 out of 5 stars on TrustPilot. Out of more than 16,000 reviews, 86% of them are deemed excellent. 

Reviews cite the specific names of helpful loan officers, indicating that customer service is above average and that applicants have a devoted expert to guide them through the process. Borrowers also mention an easy application process and fast responses. 

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*The information contained in this page is Lendio’s opinion based on Lendio’s research, methodology, evaluation, and other factors. The information provided is accurate at the time of the initial publishing of the page (October 24, 2022). While Lendio strives to maintain this information to ensure that it is up to date, this information may be different than what you see in other contexts, including when visiting the financial information, a different service provider, or a specific product’s site. All information provided in this page is presented to you without warranty. When evaluating offers, please review the financial institution’s terms and conditions, relevant policies, contractual agreements and other applicable information. Please note that the ranges provided here are not pre-qualified offers and may be greater or less than the ranges provided based on information contained in your business financing application. Lendio may receive compensation from the financial institutions evaluated on this page in the event that you receive business financing through that financial institution.