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Fora Financial business loans review

Early payoff discounts, competitive factor rates and limited eligibility requirements are bonuses for small business owners.

finder.com’s rating: 4.1 / 5.0

★★★★★

Bottom line: Fora Financial is one of our best picks for business loans — and for good reason. While it doesn’t receive the best reviews, it does have relatively competitive fees and works with smaller businesses. Read our full review or get our 30-second take.

Details

Min. Amount$5,000
Max. Amount$500,000
Loan Term4 to 15 months
Min. Credit Score670
APRVaries
Requirements6+ months in business, $12,000+ monthly revenue, no open bankruptcies
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Pros

  • Competitive factor rates
  • Early payoff discounts up to 30%
  • Open to small businesses
  • No minimum credit score required

Cons

  • Daily payments required
  • Turnaround may take up to three days
  • Not fully transparent about costs

Our take on Fora Financial

Fora Financial was founded in 2008 and has funded more than 25,000 businesses. It offers two loan options to give your business more flexibility, and its competitive factor rates make it unique in the short-term business loan space.

Compared to other lenders I’ve reviewed, Fora Financial is more upfront about the potential costs and requirements your business will need to meet to qualify. And while the turnaround time on its loans is slightly longer than other lenders, it’s still faster than most banks.

Keep in mind that short-term loans are more expensive than other types of funding. But for new businesses or those that don’t have a high annual revenue, Fora Financial may be a good choice to cover gaps in cash flow.

Fora Financial small business loans

A small business loan from Fora Financial allows you to pay back your loan over a set period — up to 15 months. But there are some important differences between a traditional term loan and one of Fora Financial's short-term loans.

Your business will be charged a factor rate, not interest, when you work with Fora Financial. And rather than monthly payments, your business will make daily payments. For seasonal businesses, or businesses that have frequent gaps in revenue, it may be better to borrow a merchant cash advance so you can take advantage of fluctuating payments based on sales.

However, you may qualify for an early repayment discount. This helps you save on the total cost of your loan because the fee for factor rates is set when you borrow. So unlike other lenders with similar options, Fora Financial may help you avoid higher costs if your business is able to repay your loan before its due date.

Short-term loan rates, fees and terms

  • Loan amount: $5,000–$500,000
  • Loan term: Up to 15 months
  • Factor rate: 1.1–1.9
  • Collateral: Not required
  • Repayment schedule: Daily payments

Fora Financial merchant cash advances

Merchant cash advances allow you to get an advance on your credit or debit card sales. Unlike a term loan, payments are based on your sales. For example, Fora Financial may take 10% of your daily sales. This means there is no set repayment period, and if your business suffers a gap in cash flow, you won't get behind.

But it also means that there's no end to your contract. It takes as long as it takes — so be prepared to pay less in a slow season and more when your business is booming.

The amount you can borrow from Fora Financial depends on your financial statements. And while payments are taken out of your daily sales, they won't be taken from your account on weekends or bank holidays. If you're able to make extra payments, you should. Like its small business loans, Fora Financial offers an early payoff discount on its merchant cash advances.

Merchant cash advance rates, fees and terms

  • Loan amount: $5,000–$500,000
  • Loan term: Not set
  • Factor rate: 1.1–1.9
  • Collateral: Not required
  • Repayment schedule: Daily payments

How factor rates work

Fora Financial uses factor rates, also called a flat fee, on both of its business loan options. It's not the most common way of determining cost, but it is easy to calculate.

Multiply your principal by the factor rate. For example, a loan of $30,000 with a factor rate of 1.1 means you will repay $33,000 — the principal of $30,000 and a fee of $3,000.

As for annual percentage rate (APR), it depends on how long you take to repay your loan or advance. If your business is able to pay back what you borrow quickly, you'll be stuck with a higher effective APR. If it takes longer, your APR will be lower.

And that's one reason lenders like Fora Financial use factor rates. Because there are no set terms on the merchant cash advance, the cost of your advance won't be determined by how quickly your business makes sales. With a flat fee, you have more flexible repayment options — and will know exactly how much it will cost to repay what you borrow.

See how Fora Financial compares to more providers

OnDeck and ROK Financial are two more short-term loan options with competitive options similar to Fora Financial.

OnDeck offers slightly smaller loans, but it has a lower annual revenue requirement than Fora Financial. It also has slightly longer loan terms and offers weekly repayments, which gives your business more flexibility when paying back a loan on line of credit.

ROK Financial is a connection service, not a lender, but it works with a wide variety of newer businesses. You'll only need to be in business for three months to qualify for some of the lenders in its network. However, you will need to meet a higher monthly gross sales requirement of $15,000.

★★★★★


Finder Rating: 4.1 / 5

Check eligibility

Loan amount

$5,000 to $500,000

APR

Varies

Loan term

4 to 15 months

Requirements

6+ months in business, $12,000+ monthly revenue, no open bankruptcies

★★★★★


Finder Rating: 4.6 / 5

Find out more

Loan amount

$5,000 to $250,000

APR

Starting at 35%

Loan term

3 to 18 months

Requirements

600+ personal credit score, 1 year in business, $100,000+ annual revenue

Fora Financial reviews and complaints

BBB accredited Yes
BBB rating A+
BBB customer reviews 2 out of 5 stars, based on 12 customer reviews
BBB customer complaints 3 customer complaints
Trustpilot Score 4.2 out of 5 stars, based on 569 customer reviews
Customer reviews verified as of 18 June 2021

Fora Financial receives decently average ratings, but its most recent reviews are negative. Customers frequently complain about poor customer service and high costs. Fora Financial frequently doesn't respond to complaints or negative reviews, making it difficult to determine how seriously it takes problems previous customers have had.

How to qualify

Fora Financial has slightly different requirements depending on the type of loan your business needs. If your business has any outstanding debts, Fora Financial suggests that you wait before applying.

Small business loans

  • At least six months in business
  • At least $12,000 in gross monthly sales
  • No open or dismissed bankruptcies in the last year

Merchant cash advances

  • At least six months in business
  • At least $5,000 in monthly credit card sales
  • No open or dismissed bankruptcies

Ineligible industries

Fora Financial won't work with these businesses or industries:

  • Accounting or financial institutions
  • Adult entertainment
  • Auto or real estate sales
  • Gambling or casinos
  • Lawyers
  • Nonprofits

How the application works

The application process is online and quick — it should only take a few minutes to fill out your information and submit any necessary documents.

To apply with Fora Financial, you will need to provide your business's three most recent bank statements as well as your driver's license, a voided check and proof of business ownership.

For a small business loan, Fora Financial also requires you to submit your annual revenue, tax returns, profit and loss statements and balance sheets.

For a merchant cash advance, Fora Financial requires you to submit three months of credit card and bank statements. It may also request tax returns, balance sheets or a profit and loss statement.

How funding works

Once you submit your information, Fora Financial generally makes an approval decision within 24 hours. Funding can take up to 72 hours after approval. You will receive your loan funds directly into your business bank account.

How repayment works

Fora Financial requires your business to make payments each business day — which means your business won't need to repay on weekends or bank holidays.

Because both loan options use a factor rate, your payments will contribute to the flat fee and principal. But Fora Financial offers early payoff discounts of 10% to 30% of the original cost of your loan. Not all borrowers qualify, however, so reach out to Fora Financial to confirm your business is eligible.

Late fees vary based on your loan contract. If you're unable to make a payment, contact Fora Financial to determine your best options.

What sets it apart

Fora Financial is a nontraditional online lender, which means its eligibility criteria and funding practices aren’t quite as slow and stringent as those of big banks and other traditional lenders. It works with businesses as new as six months, with as little as $12,000 in monthly gross sales or $5,000 in credit card receipts. This makes it easier for newer business to qualify for funding.

Along with its early payoff discount, it's one of the better short-term options out there for business owners.

But because Fora Financial doesn't offer a standard term loan, take the time to compare more lenders that may be able to fund your business — without the potentially high cost.

Business loan ratings

★★★★★ Excellent
★★★★★ Good
★★★★★ Average
★★★★★ Subpar
★★★★★ Poor

We rate business loan providers on a scale of 1 to 5 stars based on factors like transparency, costs and customer experience. We don’t take into account elements like eligibility criteria, state availability or payment frequency — we save that for our reviews.

Read the full methodology of how we rate business loan providers to get a better picture of what goes into each star rating.

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