Balboa Capital Review

Our Balboa Capital review covers eligibility requirements, underwriting process and details about what they offer.
Mar 5, 2021

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Balboa Capital is an online lender that provides small business loans and equipment financing. Like alternative lenders, you can apply online for funding and receive funds within a few days. In return, you can expect high interest rates and a frequent repayment schedule.

Overview: Balboa Capital pros and cons

Pros

  • Easy access to financing with low eligibility requirements.

  • Speedy funding process.

  • Equipment financing product offers a corporation-only guarantee option.

Cons

  • Factor rates can increase the cost of financing.

  • Lack of pricing transparency, including Balboa Capital interest rates, on their website.

  • For equipment financing, you don’t own the equipment until after you repay your loan.

  • Hard credit pulls may affect your personal credit score.

Balboa Capital business loans

With three financing products—short-term loan, equipment financing and line of credit—Balboa Capital lets you access the funding you need based on your business needs. Below, we’ll explore each product and the Balboa Capital interest rates you can expect.

How Much Do You Need?

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Balboa Capital short-term loan

Short-term loans are ideal if you need funding quickly—especially when you’re experiencing slow sales periods or need to make a big purchase in the near future.

Details for Balboa Capital short-term loan

Maximum loan amount: $5,000 - $250,000.

Loan term: 3 - 18 months.

Interest rate: 1.1 to 1.2 factor rate.

Qualifications for Balboa Capital short-term loan

Annual revenue: $300,000.

Personal credit score: No minimum.

Time in business: 1 year.

Balboa Capital equipment financing

Balboa Capital Corporation offers attractive terms for their equipment financing product if you’re looking to finance a piece of equipment to grow your business. Also, Balboa Capital equipment financing offers a corporation-only guarantee option. This means only your business—and not you personally—will be liable for the funding you take on through Balboa Capital equipment financing.

Details for Balboa Capital equipment financing

Maximum loan amount: Up to $250,000.

Loan term: 2 - 5 years.

Interest rate: Unknown.

Qualifications for Balboa Capital equipment financing

Annual revenue: $100,000.

Personal credit score: No minimum.

Time in business: 1 year.

Balboa Capital business line of credit

A business line of credit is ideal if you’re seeking short-term financing for various expenses, including bills, inventory, marketing and even completing payroll.

Details for Balboa Capital business line of credit

Maximum loan amount: $5,000 - $250,000.

Loan term: 6 - 18 months.

Interest rate: 1.1 to 1.2 factor rate.

Qualifications for Balboa Capital business line of credit

Annual revenue: $300,000.

Personal credit score: No minimum.

Time in business: 1 year.

Balboa Capital borrower eligibility

Eligibility will vary by which Balboa Capital financing product you choose. Generally, you will need to meet the following eligibility criteria:

Restricted industries

You will not qualify for any of Balboa Capital products mentioned in this review if your business operates within the following industries:

  • Oil or gas extraction.

  • Durable medical businesses.

  • Adult entertainment.

  • Gambling.

  • Lottery.

  • Casinos.

  • Aviation.

  • Boats.

Financial history

  • Balboa Capital can’t fund a business that has a tax lien of over $75,000.

  • Balboa Capital requires that 20% ownership be represented in a funding application.

  • Balboa Capital won’t fund businesses with over five non-sufficient funds (NSF) transactions or five overdrafts per month.

  • Balboa Capital can’t take a second position to other debts.

  • Balboa Capital requires businesses to have at least three open trade lines to qualify for equipment financing and at least two open trade lines to be eligible for a working capital loan.

  • Balboa Capital will consider your personal and business credit scores during underwriting, but they don’t require a minimum score.

  • Balboa Capital requires at least $10,000 per month in credit and debit card deposits for merchant cash advance applicants.

  • Fifty percent of a Balboa Capital working capital loan can go toward refinancing pre-existing debt.

Short-term loan

Balboa Capital does not offer working capital loans to businesses:

  • That experienced a bankruptcy in the past year.

  • With fewer than five monthly bank account deposits.

  • With average bank balances below $1,000.

Equipment financing

Like short-term loans, equipment financing is unavailable to small business owners who have undergone bankruptcy within the past seven years.

What you need to apply

  • Certificate of good standing.

  • Voided business check.

  • Copy of your driver’s license.

  • Two-year balance sheet (for deals above $250,000).

  • Two-year profit and loss statement (for deals above $250,000).

  • Two years of business tax returns (for deals above $250,000).

  • Three months of business bank statements (for working capital loans).

How to get a loan with Balboa Capital

If one of Balboa Capital’s products feels right for your business, the following sections will outline the application, post-funding and repayment process.

Application and underwriting process

To begin, you must fill out an online application on Balboa Capital’s website. At this stage, Balboa Capital will perform a soft pull on your personal credit to verify that you meet their minimum requirements. If you apply for more than $250,000, you’ll need to call Balboa Capital because there might be additional requirements that you have to meet.

After you submit your application, the next step will be to ensure that you deliver all of the necessary paperwork to Balboa Capital as swiftly as possible. Once they receive your full application package—documents and all—they can present an offer within an hour.

Post-funding process

After you accept this offer and sign their loan agreement, Balboa Capital will perform a hard pull on your personal credit before depositing the funds into your bank account. Moreover, Balboa Capital will charge an origination fee of up to 2% and will file a UCC lien on your business. You can potentially receive funding as quickly as the same day you apply for funds.

(If Balboa Capital declines your application, you will be able to re-apply for funding, but you’ll have to wait 30 days after your initial decline to do so.)

Repayment process

Once you fund with Balboa Capital, the timing of your first payment will depend on the frequency of your repayment schedule. For Balboa Capital equipment financing, borrowers will pay down their debt with either monthly or quarterly payments. Meanwhile, borrowers who take on a Balboa Capital working capital loan will pay down their debt with daily or weekly payments. So, you’ll only need to make your first payment immediately if you’re on a daily repayment schedule for a working capital loan.

As you pay down your Balboa Capital loan, you’ll be able to check your progress through an online dashboard and by contacting your account manager or customer service.

Balboa Capital has a concurrent funding policy that will allow you to accept an additional loan amount within 90 days. And if you want to renew your Balboa Capital loan altogether, then you’ll be able to do so once you’ve paid down 50% of your loan.

Balboa Capital customer service

Balboa Capital’s customer support is available by phone or email.

You may call the Balboa Capital corporate headquarters at (888) 225-2621 or (949) 756-0800. You may also reach their Pacific northwest office at (888) 225-2621 or (949) 756-0800.

You may also email support using their online contact form.

Balboa Capital reviews

Let’s find out what online reviewers are saying about Balboa Capital.

Positive reviews

Many positive Balboa Capital reviews praised their helpful customer service representatives. Customers received answers to their questions professionals and promptly. Even some franchising companies recommend Balboa Capital to their franchisees.

Moreover, a speedy application process was a recurring theme across several Balboa Capital reviews. Applying for a loan and then undergoing the funding process was simple with few issues. Completing many of the steps online also added convenience that saved many business owners valuable time.

Negative reviews

The Balboa Capital Better Business Bureau (BBB) profile features quite a few complaints about billing issues and confusion with some of Balboa capital’s financing products. Some reviews also criticized Balboa Capital for not being transparent about the buy-out sum that customers will face at the end. Poor customer service only added to the miscommunication and frustration.

We recommend having a legal professional read over the fine print of your loan agreement or lease agreement with Balboa Capital before you sign on. They will be able to spot any issues and make sure you know exactly what you’re signing up for.

This article originally appeared on Fundera, a subsidiary of NerdWallet.