The Business Backer Review

Lender Overview

Types of loans
  • Business line of credit
  • Commercial real estate financing
  • Invoice factoring
  • Long term
  • Merchant cash advance (MCA)
  • SBA
  • Short term
  • Startup
Loan amounts
  • $5,000 to $350,000 depending on loan type
  • Commercial real estate up to $75 million
Terms of payment
  • 4 to 18 months for MCAs
  • 10 to 25 years for real estate
  • 1 to 10 years for other loan types
Pros
  • Wide range of loan products
  • Flexible payment options
  • Funding available in as little as 48 hours
  • Lends to businesses with poor credit
  • Offers loans to startups
Cons
  • Not all loan types are available in all U.S. states
  • Hard to find details regarding qualification requirements
  • Complete fee information not readily available upfront

Who benefits most from funding through The Business Backer?

From startups to medium-sized businesses, merchants in need of flexible, customized loan products can apply for funding from The Business Backer as an alternative to traditional bank loans. Options are available for companies with poor credit and other financial challenges.

Company Profile

Established in 2007 and currently headquartered in Montgomery, Ohio, The Business Backer offers “customized funding solutions” to small- and medium-sized businesses in all 50 U.S. states. To date, the company has funded over $200 million in loans with its in-house merchant cash advances and the financial services of an extensive network of partners.

The Business Backer bases its approach to lending on a system it calls “True Relationship Financing.” Via its “True Relationship Partner” network, the lender is able to connect applicants with the right type of loan based on financial information, business history and “future goals.” It puts a great deal of emphasis on “getting to know” customers rather than just looking at their numbers and aims to provide the best offers and rates to each qualified applicant.

On its website, The Business Backer offers basic details about each loan type available, including business lines of credit, short- and long-term loans and MCAs. Its partnerships also allow the lender to offer some loan types other online lenders don’t, such as commercial real estate and startup loans. Not all financial products are available in all areas of the U.S., so potential applicants should read the information about the specific loan they wish to request before getting in touch with The Business Backer.

Credit Policy

A FICO score of at least 550 is required for merchants to qualify for the majority of The Business Backer’s loan products. For startup loans, the minimum requirement is 680.

According to Fundera, The Business Backer also allows up to three instances per month of non-sufficient funds (NSF) on bank statements and up to eight overdrafts. This gives companies with fair or even poor credit access to funding they wouldn’t be able to obtain from a bank, providing an alternative during periods of financial hardship.

Exceptions

The Business Backer is able to extend funding in situations where banks are often wary because the lender looks beyond numbers to consider the causes of unstable cash flow, irregular sales, less-than-desirable credit ratings and past due bills or taxes. The lender’s website repeatedly emphasizes a focus on a company’s “story” rather than a collection of statistics. If the complete picture of an applicant’s financial situation suggests the company is stable enough to handle loan payments, The Business Backer may make an exception to its rules for approval.

Target Market

Almost no information is available on this lender’s website regarding the industries to which it’s willing to lend. Like most online financing companies, it extends loans to businesses in industries where cash flow isn’t always predictable, including food service, retail, construction and transportation.

Because sales often vary by season in these industries, banks and other traditional lenders aren’t always willing to approve loans. The Business Backer may be able to secure financing for companies turned down due to unstable cash flow or the negative impact of a slow season on business credit.

Cautionary Industries

When bank loans aren’t an option, businesses in the following high-risk industries can apply to The Business Backer for funding:

  • Financial services
  • Insurance
  • Law
  • Real estate

The lender’s “customer story” approach brings together several factors not considered by banks during the approval process and makes it more likely that these types of businesses will be able to obtain funding.

Despite this relatively open policy, The Business Backer is more stringent in its restrictions than other online lenders. Fundera lists a range of industries unable to obtain loans from this company:

  • Adult
  • Auto sales
  • Bail bonds
  • Businesses operating from home addresses
  • Check cashing
  • Collection
  • Consumer and business financing
  • Credit repair
  • Gas and oil extraction
  • Janitorial and waste management services
  • Landscaping
  • Mortgage providers
  • Nonprofit
  • Online businesses
  • Staffing agencies
  • Travel agencies

Businesses in these categories will have to look to other lenders that cater to a broader variety of industries.

Term Length

Term lengths for funding from The Business Backer depend on which option a merchant is approved for and the overall financial health of the business at the time of application. Ranges include:

  • 4 to 18 months for MCAs
  • 1 to 4 years for long-term loans
  • 1 to 3 years for lines of credit
  • 10 to 25 years for commercial real estate loans
  • Up to 18 months for short-term and startup loans
  • Up to 10 years for SBA loans

The Business Backer or one of its partners determines an appropriate term length based on information provided during the application process and includes the terms in the final loan offer.

What’s Required to Apply

The most basic requirements for most loans from The Business Backer are at least $180,000 in annual revenue, a FICO score of 550 or more and at least one year in business at the time of application. Startups must have a FICO score of at least 680 and can apply any time during their first six months in business. Additional requirements include:

  • Business bank account
  • Applicant must own 50 percent or more of the business
  • Business must be based in the U.S.

Merchants begin the application process using a pre-approval tool The Business Backer calls BestMatch Analysis, accessed via the “Find Your BestMatch” button on the homepage or the “Apply for Funding” button on pages dedicated to specific loan types. Applicants then provide:

  • Loan amount requested
  • Annual business revenue
  • Name and business name
  • Email address

The Business Backer reviews this information, and applicants receive a call from a funding advisor within one business day. During the 15-minute session, the advisor collects additional information required to determine approval. Applicants have the option of creating an online account after completing the BestMatch form to submit information sooner and speed up the approval process.

Depending on the type of funding being requested, The Business Backer may ask for:

  • 4 months business bank statements
  • 1-year profit and loss statement
  • Most recent 4 months of credit card statements
  • 1 year of business tax returns for loans of $50,000 or more
  • Most recent balance sheet for loans of $75,000 or more
  • Proof of ownership
  • Voided business check
  • Copy of driver’s license
  • Landlord reference
  • Certificate of good standing

Once all required paperwork has been submitted, The Business Backer uses the information to form a detailed picture of each applicant’s financial circumstances and either extends an offer for a merchant cash advance or finds an appropriate option from one of its partners.

Approvals are generally sent between 8:00am and 5:00pm Monday through Friday. The length of the approval process varies depending on how quickly applicants submit paperwork and the type of loan being requested. Some funding may be available in one to three days.

Factor Rates

As with loan terms, factor rates and interest rates are assigned according to a merchant’s financial stability as determined from paperwork submitted with the application. The Business Backer lists the following rates for its financial products and those of its partners:

  • MCAs start at 1.12
  • Lines of credit start at 18 percent
  • Invoice factoring ranges from 0.3 to 1.1 percent
  • Long-term loans start at 7.99 percent
  • Short-term loans start at 1.1 percent monthly
  • Startup loans range from 8 to 20 percent annually
  • SBA loans have variable rates of 5.57 to 8 percent
  • Real estate loan APRs range from 3 to 10 percent

Payment options are flexible and vary by loan type. For MCAs, payments may be daily, weekly or semi-monthly depending on an applicant’s qualifications.

Stacking

The Business Backer prefers to be a first-position lender and doesn’t extend funding to merchants attempting to stack loans. Instead, the lender emphasizes financial health and allows several of its loan products to be used for refinancing. No information is provided regarding whether The Business Backer is willing to make any exceptions to its stacking policy.

Documentation Fees

Applicants aren’t required to pay processing fees for The Business Backer’s loan products and there are no “hidden” documentation fees.

Origination Fees

The Business Backer charges a 3 percent origination fee.

Renewal Policy

Merchants in need of additional funding can often obtain another loan from The Business Backer within 60 days of initial funding being granted. To ease the financial burden, the lender will refund all unpaid interest on the existing loan and require full payment only of the principal.

Interest Forgiveness

In addition to forgiving interest on renewed loans, The Business Backer also offers a discount of up to 35 percent for early repayment of small business loans. Information regarding interest forgiveness on other loan products isn’t provided on the website, but it’s customary for lenders to require fees based on factor rates to be paid in full regardless of when the loan is paid off.

Loan Use

Restrictions for the use of loans from The Business Backer are similar to those imposed by other online lenders. Applicants can only apply for business loans; personal funding isn’t available. Funding may also not be used by companies intending to extend loans to other businesses.

The Business Backer provides multiple suggestions for the legitimate use of funding within a business setting, many of which reflect common reasons companies seek loans:

  • Acquiring another business
  • Funding short-term projects
  • Improving business credit
  • Investing in growth or expansion
  • Maintaining cash flow in slow or off seasons
  • Obtaining a reliable source of working capital
  • Purchasing or refinancing real estate
  • Replenishing inventory
  • Starting a new business

It’s also possible for companies to use a loan from The Business Backer to refinance existing debt and pay it off in a timely manner. This option could be a lifesaver for businesses facing the possibility of bankruptcy or permanent closure if a bank or other traditional lender is unwilling to help.

Online Reputation

The Business Backer has a more positive online reputation than many other online lenders. In addition to an A+ rating from the BBB, this lender rates:

  • 5 out of 5 on TrustPilot
  • 9.5 out of 10 on Fundera
  • 4.3 out of 5 on Facebook
  • 3.5 out of 5 on Merchant Maverick

However, neither Google nor the BBB have any reviews on file for The Business Backer, which is unusual for a lender with over 10 years in business. Merchants researching funding options must read reviews available on other sites.

In these reviews, customers praise The Business Backer for its professional service, easy application process, fast delivery of funds and payment plan structures. Negative feedback points to delays when applying, unexpected additional qualification requirements and expensive fees.

Licenses & Accreditations

In addition to becoming BBB accredited in July of 2012, The Business Backer has received several notable awards and has been recognized by top industry publications. These honors include:

  • Winner of the 2014 US Chamber of Commerce Blue Ribbon Small Business Award
  • 2014 Blue Ash Businesses Awards Business of the Year
  • Inclusion in the Inc. 500 in 2012 and 2013
  • 2012 “Emerging 30” winner from the Northern Kentucky Chamber of Commerce
  • 2012 Cincinnati Business Courier “Fast 55” Award

CEO Jim Salters also received the Ernst & Young Entrepreneur of the Year Award in 2012 and was the winner of Forty Under 40 the same year. Few online lenders have received this level of recognition, and The Business Backer features several of its awards on its website to distinguish itself from less reputable companies in the industry.

Company Contacts Details

Phone number:

  • 866-615-4747

Fax:

  • 866-430-3352

Email:

  • Online contact form

Key personnel:

  • Jim Salters, President
  • Steve Tosh, COO
  • Candace Levine, VP Finance

Social media:

Theresa Houghton
About Theresa Houghton
Theresa "Sam" Houghton is a wellness consultant and freelance writer from Upstate NY. With more than half a decade of experience in the business world, Theresa understands the unique challenges small business owners face in highly competitive markets. Her experience with researching and writing positions her to provide solid advice and high-quality content on a variety of topics. When she's not writing or helping people get on track to better health, Theresa likes to read the Bible, play humorous card games and knit socks. You can learn more about Theresa's wellness consulting services at GreenGutWellness.com and connect with her on LinkedIn.

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