Fora Financial Review

Founded in 2008 as Paramount Merchant Funding, Fora Financial provides short-term small business loans and merchant cash advances (MCAs) of $5,000 to $500,000. Fora Financial offers more relaxed qualification requirements than typical long-term lenders, but charges higher repayment rates.

Consider Fora Financial if you:

• Need to borrow from $5,000 to $500,000
• Have been in business at least 6 months
• Are generating at least $5,000 in monthly credit and debit sales or $12,000 in monthly gross sales
• Have compared Fora Financial’s quoted rate with rates offered by other short-term lenders

Fora offers small business loans with a simplified application process that allows approvals to be processed quickly.

Fora Financial business loans feature:

• Loan amounts from $5,000 to $500,000
• Terms up to 15 months
• Moderate factor rates instead of interest rates, meaning you repay a fixed flat fee on top of what you borrow
• No restrictions on how loans may be used
• Free, no-obligation quotes
• Origination fees
• Early payoff discounts
• No collateral required
• Approval not solely based on your credit score

Be aware that Fora Financial’s interest rates are handled differently than many lenders. Unlike conventional long-term lenders, Fora Financial uses factor rates instead of interest rates. Whereas repayment fees calculated based on interest rates fluctuate over time with the amount of principal still owed, a factor rate is calculated up front as a flat amount expressed as a multiplier of your original amount (such as 1.3) or as a percentage added to your original amount (such as 30%).

For instance, if you borrow $30,000 at a factor rate of 30%, you must repay $39,000.

Fora Financial doesn’t publicly disclose its factor rates on its website. You have to contact the company for a quote to find out what factor rate the lender will charge you. Third-party reviewers claim Fora’s factor rates range from 10% to 30%.

Short-term loans using factor rates usually have higher repayment terms than long-term loans. This is because short-term loans typically have lower qualification thresholds than long-term loans, representing more risk to lenders. Lenders offset this risk by charging more.

The company, through Fora Financial Advance LLC, offers MCAs. Under this arrangement, the amount you borrow gets repaid by Fora Financial taking a percentage from your daily or weekly sales revenue. Fora Financial merchant cash advances feature:

• Loan amounts from $5,000 to $500,000
• No set terms
• Moderate factor rates
• No restrictions on how funds may be used
• Free, no-obligation quotes
• Origination fee
• Early payoff discounts
• Approval not solely based on your credit score

Since Fora Financial’s MCAs are repaid by the lender taking a percentage of your sales revenue, the amount you repay at a time varies with your sales performance. When you sell less, the percentage that gets taken out amounts to less money. When you sell more, more money is taken out until your debt is repaid.

Fora Financial aims to make the application process a smooth and quick experience. The process begins with filling out a simple 1-page form asking for basic contact information and your company’s annual sales. Alternately, you can call the company to begin the process.

After supplying this basic information, you will be asked to submit 3 months of recent bank statements via email or fax, plus 3 months of credit-card receipts if you’re applying for an MCA. Depending on the nature of your business, you may be asked to submit financial statements and tax returns.

Once you’ve submitted your application, you can monitor the progress of your request through an online portal. If you’re approved, you’ll need to submit proof of your identity and ownership of your business before you can receive funding. Approval normally takes 24 hours. Funds typically become available within 72 hours of approval.

Online Fora Financial reviews by third parties note some pros:

• Financing consideration for business owners with moderate credit scores
• Expedited application and approval
• Discounts for early payoffs

Online Fora Financial reviews by third parties note some cons, too:

• Factor rates aren’t transparent and tend to be relatively expensive
• Origination fees can be high
• High monthly revenue is required to quality
• Daily or weekly repayments for MCAs can impact your cash flow if you don’t plan your budget accordingly

Fora Financial’s Better Business Bureau reviews include a number of unresolved customer service complaints.

To successfully apply for financing from Fora Financial, you stand the best chance if you meet certain criteria:

• Time in Business 6+ Months
• Monthly Revenue $12,000+ (or $5,000+ in credit-card sales)
• Credit Score None Required
• Bankruptcy None in Past 5 Years

What You Need to Apply

To apply for financing from Fora, you will need:

• 3 months of recent bank statements
• 3 months of recent credit card receipts if you’re applying for a merchant cash advance
• A driver’s license for identification
• Proof of business ownership, such as articles of incorporation or tax returns
• A voided business check

For some applications, Fora may request other documentation, such as:

• Month-to-date bank statements
• Financial statements, such as profit and loss statements or balance sheets
• Tax returns

Fora Financial can be a useful source of funding if you’re generating sufficient monthly revenue to meet their criteria and if you can afford their repayment fees. But you may be able to find lower repayment terms from other lenders with more transparent rates, so we recommend shopping around before pursuing this alternative.

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