Since the financial crisis started in the late 2000s, the non-traditional lending market has exploded. [Read more…]
One of the questions we get most frequently from prospective clients is how we determine the fees associated with a CapFusion loan.
Unlike most online lenders, CapFusion doesn’t use an interest structure on its loans — we’ve found that interest rates tend to make it harder for clients to understand the total cost of a loan, and that a straightforward fee structure is more transparent.
So when a client comes to us looking for financing, we take a number of factors into consideration in determining loan fees. Among the items we look at are:
- 1.) How long your company has been in business. Companies that have an established record of successful operations tend to present less risk to lenders, so they usually qualify for lower fees.
- 2.) Your annual revenues. If our loan analysts can see a proven track record of consistent or growing annual revenues above $100,000 a year, we know that the client will be in a good position to take on financing to grow his or her company.
- 3.) Personal credit scores. As a general rule, we require clients to have personal credit scores above 500 in order to qualify for a CapFusion loan. The higher an applicant’s personal credit score, they lower the fees they’ll pay in most cases.
The good news is, because we place a high value on repeat business, once you’ve established a relationship with CapFusion, our analysts take your on-time payments on existing and previous loans into consideration when determining the fee structure on new loans.
If you’re ready to move your business forward with a loan today, contact CapFusion and let our loan analysts find the right product for you.
One of the first things we realized about the loan industry when we started seeking capital as entrepreneurs years ago was that a lot of lenders seem to go out of their way to make the total cost of a loan confusing.
They’ll lure you in with low-sounding rates, but won’t draw your attention to the fine print provisions about additional interest and fees that get tacked on. It isn’t until after you’ve signed your name on the line and gotten your first repayment statement that you realize the good deal you thought you were getting is anything but.
This practice is clearly questionable from an ethical perspective. But we think it’s bad business as well. Because at CapFusion, our goal is to create repeat customers — clients who come back to us when they need financing quickly to help move their business forward. The key to creating repeat customers is building a business relationship built on trust and reliability.
That’s one of the reasons we structure our loans with a straightforward fee structure instead of an interest rate. Clients have told us time and again that interest rates are confusing and make it difficult to calculate the true cost of their loan.
When you apply for a loan from CapFusion, our loan analyst will give you a proposed repayment structure that clearly spells out the small daily payments you’ll make. Those payments include the set fee that’s straightforward and easy to understand — because we know that if you’re going to trust us enough to do business with us again, you need to know exactly what the deal looks like.
If you’ve been turned off or frustrated by the convoluted repayment and interest structures other online lenders try to push, contact one of our loan analysts today. You’ll see the CapFusion difference right away.
When CapFusion entered the online loan space, we saw a clear need for a lending partner that business owners could trust.
To that end, we’ve made transparency a top priority. Which is why we work hard to ensure every client fully understands our repayment terms, and how they’ll fit into your daily business finances.
Here are a few facts about the typical repayment structure for a CapFusion loan:
- Loans are issued for a term of between three and 24 months.
- Small loan repayments are drawn from clients’ accounts each weekday. This daily repayment structure has a number of benefits. For one, it means our clients never have to make a huge payment that would put a significant dent in their monthly cashflow, which allows them to have working capital on hand to deal with unexpected expenses. It also ensures they don’t find themselves in a situation where they get so far behind on the loan that it’s impossible to catch up. Missing a monthly payment and trying to make two monthly payments the following month can become very challenging. Missing one small daily payment is very easy to catch up on.
- CapFusion structures its loans so that borrowers don’t pay interest. Instead, they pay a loan fee that is determined based on the amount of time the money is held, the customers’ credit profile and the company’s cash flow. This loan fee is repaid over the life of the loan along with the principal. We’ve found that this approach helps business owners get a clear sense of their total balance due.
- We offer discounts to customers who pay off their loans early. This is one of the biggest differentiators between CapFusion and the competition. Many online lenders will penalize borrowers for trying to bring their balance down before the loan term is up. CapFusion, on the other hand, wants to build lasting partnerships with its clients, so we look for ways to make working with us as beneficial as possible.
When your business is in need of capital to take advantage of opportunities in the market or grow, CapFusion wants to be the partner to help. Contact us now to get your application started, and you could have funding in a matter of days.
From time to time, customers applying for a business loan from CapFusion ask why we use daily repayment installations.
The reason is pretty simple: We want to ensure that your loan helps your business succeed and grow — and that it doesn’t turn into a major headache that costs you more money than it should.
Traditional lenders often set repayment terms that require monthly or quarterly payments. After doing detailed research on the traditional lending market, we found that these kinds of repayment terms actually encourage borrowers to get behind on their payments. Without a daily payment requirement, some small business owners have a hard time setting aside the money they need to repay their loans, and find themselves in a bind when the repayment invoice turns up in the mail.
The fact is, these lenders may actually be rooting for their clients not to pay them back on time because it means they can charge additional interest and late fees. They want their clients to be late with their payments because it means more money for them.
That’s not the CapFusion approach. We want to provide you the funding you need — and create a positive relationship that will have you coming back to us for repeat business in the future.
CapFusion was founded to be a true partner for businesses. That’s why, in addition to our loan services, we offer affordable bookkeeping, credit card processing and bill collecting services. We know that if we’re going to be successful, small businesses need to look to us as a trusted partner that makes their lives easier.
The daily repayment structure — a format that requires a small withdrawal from your business account each day — is part of that philosophy. It is designed to help clients make sure they’re keeping up with their loan repayments so they don’t get in a situation where the loan turns into a burden instead of a boost.
Additionally, daily payments increase your credit history with both CapFusion and other credit bureaus, helping your business build more options and flexibility for future lending. Traditional loans only provide one “trade line” — a record of a payment on a loan — each month. Successful trade lines help build good credit for borrowers. With a CapFusion loan, you have 21 trade lines each month, which rapidly increases your positive credit history.
If you have any questions about the FusionLoan structure or our lending philosophy, don’t hesitate to contact us.