To learn more about Ready Capital and decide if it’s right for your business, please continue reading:
Small business owners have many options for financing, but SBA loans remain the gold standard. The drawback to SBA loans is that most lenders have strict qualifications, and getting your funds takes weeks or months.
Some lenders, like Ready Capital, can help expedite the process as an SBA-preferred lender. Ready Capital’s loan application process is efficient, offering transparency in loan information and rapid prequalification for SBA microloans, enhancing the funding experience for small business owners. The company also offers USDA B&I loans. However, it might not be the right fit for every small business.
We can help you determine if the non-bank lender meets your financing needs by providing the pros and cons of the loan and explaining how to apply. Specifically, we’ll answer these questions and more:
Ready Capital is a multi-strategy real estate finance company that provides commercial real estate (CRE) loans, residential mortgages, and small business loans. Its subsidiary, ReadyCap, primarily handles its small business loan programs, which are SBA loans and USDA B&I loans.
The company launched in 2012. It is based out of New York, NY. Most of its loans are backed by CRE holdings. Ready Capital has a proven track record with over $1.6 billion of SBA funds delivered.
Larger enterprises can pursue various CRE loans with the company, but today we’re focusing on their small business offerings under the ReadyCap brand. The lender offers two loan options for small businesses.
The US Small Business Administration (SBA) oversees the SBA loan program. However, potential borrowers must apply to an approved lender, like ReadyCap, instead of the SBA. Loan amounts for SBA 7(a) loans range from $350,000 to $7,000,000. Loan terms for SBA 7(a) loans can be up to 25 years.
The government agency sets rules for lenders to follow, including capping interest rates and fees. The SBA also partially guarantees up to 85% of the loans. If borrowers fall short of the standard collateral requirements, personal real estate or property can be utilized as collateral.
With backing from the federal government, lenders can offer higher borrowing amounts at lower interest rates and longer repayment terms. There are no prepayment penalties for SBA 7(a) loans through Ready Capital.
As an SBA-preferred lending institution, ReadyCap can expedite certain aspects of the SBA loan application, which usually takes between a few weeks and two months. You can use the funds for most business purposes, including commercial real estate, marketing, working capital, expansion, acquisition, and refinancing business debt.
The US Department of Agriculture (USDA) Business & Industry (B&I) loans help support small businesses in rural communities. ReadyCap is licensed to offer USDA B&I loans in most states.
Ready Capital is transparent about its fees and interest rates for commercial real estate loans. The company provides detailed information about the loan terms, including the interest rates, packaging fees, and other charges. Ready Capital’s fees and interest rates are competitive with other lenders, making it an attractive option for small business owners. Collateral is often required for commercial real estate loans from Ready Capital.
As an SBA-preferred lender, Ready Capital can offer favorable loan terms, including lower interest rates and fees. The company’s loan programs are designed to provide flexible financing options for businesses, with loan terms that can be tailored to meet each business’s specific needs. This transparency and flexibility make Ready Capital a strong contender for businesses seeking reliable, cost-effective financing solutions. Ready Capital waives packaging fees for veterans applying for loans.
The qualifications depend on the loan type. Ready Capital partners with various financial institutions, such as banks and lending advisors, to provide comprehensive borrowing solutions for clients.
ReadyCap indicates you need a minimum personal credit score of 680 to qualify for an SBA loan. Unlike other lenders, it doesn’t list a minimum annual revenue. It’s also one of the few lenders that offer SBA funding to startups, so there’s no time in business requirement.
Applicants must also meet the SBA’s eligibility criteria, which are:
The lender does not list qualifications for USDA B&I loans but provides access to USDA’s convenient eligibility tool.
Ready Capital offers a wide range of commercial real estate loans, catering to the diverse needs of small business owners and mid-sized businesses. These loans can be used for various purposes, such as purchasing or refinancing commercial properties, construction, and renovation. With Ready Capital’s commercial real estate loans, businesses can access substantial funding, up to $5 million, at competitive interest rates.
Ready Capital’s commercial real estate loan programs are designed to provide flexible financing options for businesses. The loan terms vary based on the loan program, borrower eligibility, loan amount, and other factors. Ready Capital’s service provider, iBusiness, offers a fully digital solution supported by live, U.S.-based customer service, web-based, automated loan origination, and AI-driven, immediate terms and approvals. This ensures a smooth and efficient process, allowing businesses to focus on growth and operations.
To be eligible for SBA loans, the lender requires a debt service coverage ratio (DSCR) between 1.15 and 1.30. You must also make an equity injection (down payment), usually around 10% of the total loan amount.
USDA B&I loans are only available in areas with a population of 50,000 or fewer. Most small business owners would qualify for SBA loans over B&I loans.
ReadyCap offers SBA loan options for veteran-owned businesses (at least 51% of ownership). The program makes it easier for veterans to obtain an SBA loan.
The SBA requires lenders to report SBA loan information to the major credit bureaus. With most business loans, reporting to the credit bureaus is optional. That means you could potentially build your business credit with a ReadyCap SBA loan.
Ready Capital’s customer service and support. The company provides a streamlined application process and a dedicated team of loan officers and customer service representatives to assist with any questions or concerns. Ready Capital’s customer service is available through its website, phone, and email, making it easy for businesses to get the support they need. Ready Capital is rated Great with 4.2 / 5 on Trustpilot.
The customer service team at Ready Capital is knowledgeable and experienced, with a deep understanding of the company’s loan programs and the needs of small business owners. The team is responsive and proactive, working closely with businesses to ensure they receive the funding needed to succeed. This commitment to customer service helps Ready Capital stand out as a reliable partner for small businesses seeking financial support.
Ready Capital offers a wide range of commercial real estate loans, catering to the diverse needs of small business owners and mid-sized businesses. These loans can be used for various purposes, such as purchasing or refinancing commercial properties, construction, and renovation. With Ready Capital’s commercial real estate loans, businesses can access substantial funding, up to $5 million, at competitive interest rates.
Ready Capital’s commercial real estate loan programs are designed to provide flexible financing options for businesses. The loan terms vary based on the loan program, borrower eligibility, loan amount, and other factors. Ready Capital’s service provider, iBusiness, offers a fully digital solution supported by live, U.S.-based customer service, web-based, automated loan origination, and AI-driven, immediate terms and approvals. This ensures a smooth and efficient process, allowing businesses to focus on growth and operations.
The lender’s website does not publish information on a business loan referral partner program, but some online reviews mention using partners. ISOs and business loan brokers should contact the lender directly to ask about offering its services to their small business clients.
ReadyCap uses LenderAI to streamline the borrower and broker experience. Follow these steps to apply.
ReadyCap provides an online contact form to start the process. You can also call the lender to get started. Either way, you’ll provide some basic information about yourself, your business, how much you’re borrowing, and how you’ll use the money.
Once you start the process, a ReadyCap representative will reach out to discuss various financial products suitable for your business needs and help you complete the process.
You will likely need to provide extensive documentation, which could include the following:
The SBA loan process is complex, and some businesses might need to provide more information than others. Your dedicated representative will help you complete the process and get funded.
The repayment process for an SBA loan is straightforward. You will repay the amount you borrowed (principal) plus interest and fees in fixed monthly payments.
In most cases, you’ll set up automatic payments using an ACH transfer. Alternatively, you can work with the lender to make other payment arrangements.
Small business owners who get a USDA B&I loan will also have fixed monthly payments. The ReadyCap website does not publish information on renewals.
You can typically save interest on ReadyCap business loans if you pay them off early. Most times, there won’t be an early repayment fee unless the loan terms are for 15 years or more. In that case, there is a prepayment penalty if you pay it off in the first five years. The penalty reduces each year.
One of the primary benefits of the lender is that it is an SBA-preferred financing company, meaning it can help get loan approval and funding faster. It can also offer high borrowing amounts at low rates.
The company charges very few extra fees, partially because the SBA caps what a lender can charge. It’s also one of the few SBA lenders that offers startup and franchise financing.
Veteran-owned businesses can also benefit from the company’s veteran business loan programs. Small business owners get longer repayment terms, which lowers your monthly payments.
While the ReadyCap website provides helpful information, it doesn’t publish its rates and fees. SBA lenders sometimes include additional charges like packaging fees. Potential borrowers must contact the lender or apply to get their rates and fee structure.
Despite being a non-bank lender, ReadyCap doesn’t offer an online application. You can complete a contact form to start the process, but you won’t get information on pre-qualification until you speak to a representative and follow the instructions to apply.
Government-backed loans typically have strict qualifications and take a while to finalize. You should also be aware that the company has negative reviews. However, most of those are related to the now-defunct PPP loan program.
Here’s a quick summary of the benefits and drawbacks of ReadyCap small business loans.
Pros:
Cons:
Yes, Ready Capital is a legitimate lender. It is a publicly traded company and a licensed lender. While it has many bad reviews, it’s still a legitimate company.
Yes, ReadyCap is an SBA-preferred lending institution, which means it can bypass the SBA review process and approve loans more quickly. Not only is it a preferred lender, but ReadyCap is one of the most active lenders for SBA 7(a) loans.
ReadyCap has many negative reviews but some positive ones as well. It has a D- rating at the Better Business Bureau (BBB). It has a 1 out of 5 BBB rating on 59 customer reviews, and there have been 76 complaints closed in the last three years.
It is not BBB accredited. Ready Capital is rated Great with 3.9 out of 5 on Trustpilot. The company has mixed online reviews focusing on both positive and negative experiences.
Most of the negative reviews and BBB complaints center on the PPP loan program enacted during the Covid-19 pandemic. Many online and non-bank lenders were ill-prepared for PPP loans, and the program was very complicated. Even so, a few customers mentioned they went out of business because the online lender did not disburse the loan proceeds on time.
There are also some non-PPP complaints about the customer service team and mix-ups surrounding loan proceeds. A few customers mentioned the company trying to pressure them into buying insurance. Some customers described their experience as a total scam, citing communication issues.
We should mention that despite the high volume of negative reviews, 64% of the company’s reviews on Trustpilot have 5 stars. Positive reviews highlighted the professional and helpful nature of the Ready Capital team. Cynthia and other team members received praise for their communication and support during the loan process.
Several customer reviews state the company helped save their business during the pandemic. Multiple users called out their customer service representatives by name when praising the service.
The lender doesn’t publish much regarding qualifications, except that SBA loans require a credit score of 680. Otherwise, the only way to determine eligibility is to contact the company directly and speak with a representative.
If you applied and were declined, the denial letter should explain why. If not, you can contact the lender directly for more information.
Fortunately, there are many alternative lenders to consider if ReadyCap doesn’t work out for you. You can find lenders offering SBA loans, several of which provide a convenient online application.
If you were denied because you’re not eligible for an SBA loan, many loan options have lower qualifications. You might be interested in one of the following small business loans:
ReadyCap is best suited for small business owners seeking an SBA loan or USDA B&I loan. The process for getting these loans can take weeks, but the company can help expedite SBA loans as a preferred lender.
Business owners with a credit score below 680 or those who need quick funding must find a different lender. Some lenders offer same-day funding, for example. Additionally, as the company doesn’t provide an online application, you could potentially receive the same loans with a similar application process at the local branch of a traditional bank or credit union.
Even so, the non-bank lender’s AI tool and convenient online customer service might make it worth it. Ensure you understand all the lender’s details and costs before you decide on a loan.
Based on user reviews, available products, and website transparency, we rate ReadyCap as 3.5 out of 5. The lender is definitely worth considering for SBA loans, but the lack of additional lending products and the negative user reviews hold it back from a higher score.
Disclaimer: The ReadyCap trademark is owned by Ready Capital Corporation and its use herein is for reference purposes only and it does not indicate sponsorship or endorsement from Ready Capital Corporation.
Fraud Disclosure:
Please be aware that individuals have been fraudulently misrepresenting to business owners (and others) that United Capital Source, Inc. (“UCS”) can assist small businesses in receiving government grants and other forgivable business loans, when in fact those grants or loans do not exist or are not available. These individuals have ulterior motives and are engaging in the unauthorized use of the names, trademarks, domain names, and logos of UCS in an attempt to commit fraud upon unsuspecting small business owners.
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