Few online business lenders are as highly regarded as BlueVine. If you were to research their products, you’d quickly be greeted by a plethora of glowing reviews, and for a good reason. For starters, BlueVine offers virtually all of the advantages you’d expect from a reputable online business lender. Their products are easily accessible for younger, smaller businesses, especially those with subpar personal credit. Even BlueVine’s fee policies are considered optimal in comparison to the rest of the industry.
However, certain cash flow situations call for different products, and some businesses might not be able to meet BlueVine’s requirements or fulfill their repayment structures. In this guide, we’ll discuss what separates BlueVine from other popular online lending options.
Specifically, we’ll answer these questions:
What is BlueVine?
BlueVine offers three products: business term loans, business lines of credit, and invoice/receivables factoring. Each product carries its own requirements, borrowing limits, and maximum terms. For business term loans and business lines of credit, you can borrow up to $250,000 with terms of up to 12 months. For invoice factoring, you can borrow up to $5 million with terms of up to 13 weeks.
If you’re not familiar with invoice factoring, BlueVine will purchase your unpaid invoice for about 85%-90% of its value. This percentage depends on the size of the invoice when it was originally due, and the customer’s creditworthiness. Once BlueVine collects the payment, you receive the remainder from the first payment, minus fees.
As you can see, BlueVine specializes in short-term financing. Thus, their products work best for plugging a minor gap in cash flow or covering a significant, one-time expense.
What Do You Need to Apply for BlueVine?
To apply for a business term loan or business line of credit, you will need:
- Three months of business bank statements (or a read-only link to your business bank account)
- Business address, phone number, DBA, and tax ID number
- Your personal phone number, email, address, social security number, date of birth, and ownership percentage
To apply for invoice factoring, you will need this information as well as copies of invoices or read-only connection to your invoicing or accounting software.
Other Important Factors for BlueVine:
To qualify for a business term loan and business line of credit, you’ll need:
- At least six months in business
- At least $100,000 in annual revenue
- A minimum credit score of 600
To qualify for invoice factoring, you’ll need:
- At least three months in business
- At least $120,000 in annual revenue
- A minimum credit score of 530
- Invoice must have value of at least $500
- Must have a B2B business model
- Must have no past-due outstanding invoices
- Your invoices cannot be due in less than one week, but no more than 13 weeks
- The customer involved must have already received the product or service
BlueVine’s line of credit can carry terms of six or twelve months. For the latter option, you’ll need a credit score of at least 620, at least two years in business, and at least $450,000 in annual revenue.
BlueVine’s business term loans can carry terms of six or twelve months as well. However, both variations carry the same requirements.
BlueVine does not work with businesses located in North Dakota, South Dakota, or Vermont. Businesses with tax liens can be approved if the business is currently on a repayment plan. However, tax liens may prevent applicants from accessing more significant borrowing amounts. If you have previously declared personal bankruptcy, you can be approved as long as the bankruptcy was discharged at least one year ago.
Applicants for lower borrowing amounts may have to sign a personal guarantee. This means that if you default, BlueVine can seize your personal assets to make up for the loss.
For BlueVine, You Need to Know That:
BlueVine’s interest rates can vary tremendously, depending on factors like credit score and overall financial health. For business term loans and lines of credit, interest rates range from 4.8% to 51%. For invoice factoring, interest rates range from 0.25% – 1.7% per week. That means you’ll be charged 0.25% – 1.7% for every week your customer fails to pay the invoice.
The minimum borrowing amount for the first two products is $5,000, compared to $20,000 for invoice factoring. Business term loans require weekly payments, while lines of credit can be repaid weekly or monthly, depending on your terms.
Payments for all BlueVine products are reported to Experian. Thus, making timely payments will improve your business credit score.
There are no annual fees, monthly fees, or origination fees for all three products.
How To Apply With BlueVine:
Like many online business lenders, applying for BlueVine involves a short application that can be completed very quickly. Here’s how to get started:
Step 1: Fill Out Application
You can apply for BlueVine products through United Capital Source. The UCS online application requires basic information about you and your business. After entering this information, BlueVine will perform a soft pull on your personal credit score. According to Experian, soft inquiries do not impact your credit scores.
Step 2: Review Your Offer
After submitting your application, BlueVine will get back to us with an offer anywhere from five minutes to 24 hours (one business day). UCS will help negotiate rates and terms to make sure you receive the most beneficial arrangement for your business.
Step 3: Accept Offer & Get Funded
If you choose to accept the offer, BlueVine will perform a hard credit pull. You can then sign your loan documents and decide how you wish to receive the funds. If you pay $15 for a wire transfer, BlueVine will deposit the funds in your bank account in just a few hours. If you choose not to pay, it could take up to three business days to get funded. Invoice factoring proceeds typically take the least time to reach a client.
BlueVine: Post Funding
For a business line of credit, BlueVine will charge you a 1.6% to 2.5% draw fee every time you draw funds. BlueVine will also review your business’s debt before allowing you to use your line of credit. For this reason, your request to draw funds may be denied if you’ve accrued too much new debt.
If you have a six-month term, BlueVine will automatically deduct 26 weekly payments from your bank account. If you have a twelve-month term, you will make twelve automatic monthly payments.
Since this is a revolving line of credit, the funds you repay become available to you again. For example, let’s say your weekly payment is $200 and your fee is $10. In this case, paying back that $200 will make your credit line go back up by $190.
For a business term loan, weekly payments will automatically be deducted from your bank account over the course of 26 or 52 weeks.
For invoice factoring, your customer has two weeks to pay. If the customer does not pay within that time frame, you must pay back the invoice yourself. You can either pay the full amount in one shot or enroll in an installment plan.
BlueVine differs from many other factoring companies in that they will not notify your customer when you sell their invoice. However, BlueVine may advance a larger portion of the invoice if you agree to notify the customer about the sale. This may increase the likelihood of your customer paying on time.
Once you accept an offer, BlueVine will file a blanket UCC lien on your business. BlueVine may also be able to refinance up to 100% of your existing debt.
What are the Advantages of BlueVine?
BlueVine easily fulfills some of the main advantages businesses look for in online business lenders. It’s not uncommon for borrowers to receive funds in a matter of hours. Other business lenders might take closer to a few days to distribute funding. Their application process is also speedy and requires minimal paperwork. This makes BlueVine very attractive for businesses that need money now; not next week.
Another significant advantage is BlueVine’s low minimum credit score. While other business lenders have minimums closer to 650, BlueVine approves lines of credit for credit scores as low as 600 and invoice factoring for credit scores as low as 530.
As a provider of short-term financing, it’s no surprise that BlueVine prioritizes accessibility and convenience.
Additionally, BlueVine’s online dashboard allows you to request advances for invoices continuously. You can use their invoice factoring program as many times as you want, as long as you stay within your approved credit line.
What are the Disadvantages of BlueVine?
BlueVine’s biggest disadvantage is its prices. All of their products are very expensive in comparison to the business financing industry in general. But high interest rates should be expected in any business lender with such loose requirements. It’s risky to lend to younger businesses with poor credit. Hence, BlueVine attaches high interest rates to offset the heightened risk.
But while many online business lenders charge higher rates, very few require weekly payments. This payment frequency might not work for businesses that don’t maintain considerable bank balances throughout the month.
Between the size of your payments, the payment frequency, and the draw fee for a line of credit, BlueVine’s repayment structure could put pressure on your cash flow.
Also, we previously noted that invoices for invoice factoring have a two-week due date. If your customers take longer than that to pay, you have to come up with the money yourself. Other business lenders might be willing to give more extended time frames.
BlueVine’s time frame for invoice factoring further emphasizes the central need of their target market: quick funding. If you can’t wait more than two weeks for your customer to pay you, then you probably need cash right away for some unforeseen circumstance.
Frequently Asked Questions
Here are a few common questions potential clients might have about BlueVine:
How Does BlueVine Work?
These questions likely pertain to BlueVine’s application process and repayment structures. Applying for BlueVine requires minimal paperwork, and the requirements are incredibly loose. Thus, the application can be completed in a matter of minutes. Depending on the product you apply for and your business’s financial health, you may be able to access funds on the same day in which you applied.
For business lines of credit, the repayment structure depends on your terms. The six-month version features automatic weekly payments while the twelve-month version features automatic monthly payments. On the other hand, all business term loans require weekly payments, regardless of your terms.
For invoice factoring, BlueVine purchases the invoice for 85%-90% of the price. Then, your customer has two weeks to pay BlueVine. If they do, you receive the remainder from the first payment, minus fees. If your customer does not pay BlueVine within this time frame, you have to come up with the money yourself.
Is BlueVine Safe?
BlueVine’s high rates might give the impression that they do not have their clients’ best interests at heart. However, high rates generally come standard with short-term financing. And since BlueVine works with clients with bad credit and little time in business, high rates ensure that they can continue to support themselves should their clients run into financial trouble. These rates are also a logical drawback to being able to apply for and access borrowed funds within 24 hours.
Any suspicions about BlueVine’s legitimacy can be quelled by their A-plus rating from the Better Business Bureau (BBB), along with their myriad of positive reviews.
But if you’re worried that BlueVine’s rates and weekly payments could impact your cash flow, your instinct may be correct. You should never pursue an online business funding product that you aren’t sure you can afford. For this reason, you might want to contact BlueVine and explain your financial circumstances to make sure this is the right product for you.
What Do BlueVine Reviews Typically Focus On?
Many BlueVine clients praise the simplicity of the application process. BlueVine reviews also tend to revolve around their quality customer service. Since BlueVine is an online business lender, new clients might be caught off guard by how easy it is to speak to a human representative.
Some reviews came from new clients who were not aware that BlueVine examines your business’s debt every time you try to draw funds from your line of credit. Unfortunately, business lenders might not disclose policies of this nature unless you ask. That’s why you should always ask about potential restrictions on your drawing ability before accepting a new line of credit.
Do They Report to Credit Bureaus?
BlueVine is one of the few online business lenders that reports your payments to a major credit bureau, regardless of which product you choose. This even includes invoice factoring, which does not feature weekly or monthly payments. Hence, using BlueVine products successfully will raise your business credit score. Specifically, BlueVine reports to Experian.
What if I’m Declined by BlueVine?
BlueVine might decline your application after determining that your cash flow cannot handle the cost or repayment structure of your desired product. The six-month line of credit requires weekly payments, as do all business term loans. To satisfy this repayment structure, your cash flow must be very consistent. Occasional dips in revenue or cash flow shortages could make it difficult to pay the same amount every week.
As for invoice factoring, BlueVine might decline your application if your customer seems unreliable or has poor business credit. Then again, this could mean needing three weeks to pay instead of BlueVine’s limit of two.
Thankfully, plenty of other online business lenders offer more flexibility with their repayment structures. The application process is just as quick as BlueVine’s, and their requirements are comparably loose. Even younger businesses with poor credit can choose between daily, weekly, bi-weekly, or monthly payments. You may also be able to access longer terms, instead of BlueVine’s 12-month limit.
If you’re interested in invoice factoring, you shouldn’t have trouble finding another business lender that gives your customers more than two weeks to pay.
Making Your Decision
Online business lenders tend to get lumped together. At first, it seems like they all offer the same products for the same types of businesses. But as you can see, companies like BlueVine have unique requirements, borrowing limits, terms, and repayment structures. These are the kind of details potential clients must keep in mind when examining their options. Different online lenders suit different types of cash flow. The more you know about your individual goals and challenges, the easier it will be to find the right product for your business.