A Look at Bond Street, Backed with our Research

Written by Janet Gershen-Siegel

Looking for the greatest online lenders? Bond Street is one of several online lending companies. They offer Term Loans to businesses. We look at the specifics and drill down into the details.

Bond Street Background

Bond Street is located online here: https://bondstreet.com/. Their physical address is in New York, NY. You can call them at (917) 722-3891.

Their contact page is here: https://bondstreet.com/contact. You can email them at: support@bondstreet.com.

Bond Street is supported by investment capital from Spark Capital; Jeffries; Home Brew; Founder Collective; Collaborative Fund; Eagle Cliff; Slow Ventures; and more.

Term Loans

Bond Street has term loans of $100,000 – $1 million. The terms range for as long as 1 – 3 years. They ask for both EIN and the borrower’s Social Security number. The offer arrives within three days. They will only do a soft credit pull.

A FICO consumer credit score of 640 or better is most likely to get a loan.

However, if your own FICO score falls short, Bond Street will look at other factors. Your company must be in business for two years or more. It must also have annual revenues of at least $200,000.

Fees

Their rates start at 6% and they go up to 22%. The APR ranges from 8 – 25%. There is also a 3 – 5 % origination fee.

Caveats

Note: Bond Street is not able to lend in North Dakota, Nevada, South Dakota and Vermont. Also, in some select states, they are unable to offer financing at amounts of less than $50,000.

Hence if your business has its offices in any of those states, you may be completely out of luck.

Bond Street Advantages

Advantages start with the soft credit pull. So this could be crucial for a lot of small business owners. Plus this online lender will look at factors beyond your personal credit if your FICO score is low. They offer very large loans if you do qualify.

These pluses may very well be enough to tip the scales in favor of this particular online lender.

Bond Street Disadvantages

Disadvantages are the somewhat longer time in business requirement. Also, there is a fairly high annual revenue requirement. And the maximum APR is pretty high. However, it is not the highest annual percentage rate in the online lending space.

Another disadvantage is the limits on where this online lender can do business. For some business owners, that will decide everything.

Bond Street Takeaways

So the companies which will do the best with Bond Street have a couple of years of successful operations under their figurative belts. These companies will also do well if the entrepreneur has less than stellar credit but still needs a very large loan.

So for companies needing smaller amounts, or that cannot meet the time in business and annual revenue requirements, Bond Street is not going to be a good fit for them.

Business Credit Building: An Alternative

Due to the fact that business credit is independent from consumer, it helps to protect a business owner’s personal assets, in the event of a lawsuit or business insolvency. Also, with two distinct credit scores, a small business owner can get two separate cards from the same merchant. This effectively doubles purchasing power.

Another benefit is that even start-ups can do this. Heading to a bank for a business loan can be a recipe for disappointment. But building small business credit, when done properly, is a plan for success.

Personal credit scores are dependent on payments but also various other factors like credit utilization percentages. But for corporate credit, the scores actually only depend on whether a small business pays its invoices on a timely basis.

The Process

Establishing corporate credit is a process, and it does not occur without effort. A corporation will need to proactively work to establish corporate credit. Nonetheless, it can be done easily and quickly, and it is much more efficient than establishing personal credit scores.

Vendors are a big aspect of this process.

Carrying out the steps out of order will result in repetitive denials. No one can start at the top with business credit. For instance, you can’t start with store or cash credit from your bank. If you do you’ll get a rejection 100% of the time.

Corporate Credibility

A corporation has to be credible to lending institutions and vendors. Hence, a business will need a professional-looking web site and e-mail address, with site hosting bought from a merchant like GoDaddy.

In addition company phone and fax numbers ought to have a listing on ListYourself.net.

Likewise the company telephone number should be toll-free (800 exchange or the like).

A corporation will also need a bank account dedicated only to it, and it has to have all of the licenses essential for operating. These licenses all have to be in the identical, correct name of the company, with the same company address and phone numbers.

So bear in mind that this means not just state licenses, but potentially also city licenses.

Working with the IRS

Visit the IRS web site and get an EIN for the business. They’re totally free. Pick a business entity like corporation, LLC, etc.

A small business can get started as a sole proprietor but will more than likely want to switch to a variety of corporation or partnership to diminish risk and make the most of tax benefits.

A business entity will matter when it concerns tax obligations and liability in the event of litigation. A sole proprietorship means the entrepreneur is it when it comes to liability and taxes. No one else is responsible.

If you run a company as a sole proprietor, then at the very least be sure to file for a DBA (‘doing business as’) status.

If you do not, then your personal name is the same as the small business name. Consequently, you can wind up being personally responsible for all small business financial obligations.

And also, according to the IRS, by having this structure there is a 1 in 7 possibility of an IRS audit. There is a 1 in 50 probability for corporations! Avoid confusion and dramatically lower the odds of an Internal Revenue Service audit as well.

Starting the Business Credit Reporting Process

Start at the D&B web site and get a totally free DUNS number. A DUNS number is how D&B gets a business in their system, to produce a PAYDEX score. If there is no DUNS number, then there is no record and no PAYDEX score.

Once in D&B’s system, search Equifax and Experian’s sites for the business. You can do this here. If there is a record with them, check it for accuracy and completeness. If there are no records with them, go to the next step in the process.

This way, Experian and Equifax will have something to report on.

Trade Lines

First you ought to build trade lines that report. This is also known as vendor accounts. Then you’ll have an established credit profile, and you’ll get a business credit score.

And with an established business credit profile and score you can begin acquiring revolving store and cash credit.

These kinds of accounts tend to be for the things bought all the time, like coffee, shipping boxes, outdoor work wear, ink and toner, and office furniture.

But to start with, what is trade credit? These trade lines are credit issuers who will give you starter credit when you have none now. Terms are commonly Net 30, instead of revolving.

Hence if you get approval for $1,000 in vendor credit and use all of it, you will need to pay that money back in a set term, like within 30 days on a Net 30 account.

Details

Net 30 accounts need to be paid in full within 30 days. 60 accounts need to be paid completely within 60 days. In comparison with revolving accounts, you have a set time when you have to pay back what you borrowed or the credit you used.

To start your business credit profile the right way, you ought to get approval for vendor accounts that report to the business credit reporting bureaus. As soon as that’s done, you can then make use of the credit.

Then pay back what you used, and the account is on report to Dun & Bradstreet, Experian, or Equifax.

Not every vendor can help like true starter credit can. These are vendors that will grant an approval with nominal effort. You also want them to be reporting to one or more of the big three CRAs: Dun & Bradstreet, Equifax, and Experian.

But you may have to apply more than once to these vendors, and you may have to buy some items you do not really need, to confirm you are reliable and will pay in a timely manner. Consider donating nonessential items to charitable organizations.

Revolving Store Credit

Once there are 5 to 8 or more vendor trade accounts reporting to at least one of the CRAs, move onto revolving store credit. These are companies which include Office Depot and Staples. These companies are more likely to have items you need.

Use the business’s EIN on these credit applications.

One instance is Lowe’s. They report to D&B, Equifax and Business Experian. They need to see a DUNS and a PAYDEX score of 78 or more.

Fleet Credit

Are there 8 to 10 accounts reporting? Then progress to fleet credit. These are service providers such as BP and Conoco. Use this credit to purchase, repair, and maintain vehicles. Make certain to apply using the business’s EIN.

Cash Credit

Have you been sensibly handling the credit you’ve gotten up to this point? Then move to cash credit. These are service providers such as Visa and MasterCard. Keep your SSN off these applications; use your EIN instead.

These are companies such as Walmart and Dell, and also Home Depot, BP, and Racetrac. These are often MasterCard credit cards. If you have 14 trade accounts reporting, then these are feasible.

Monitor Your Business Credit

Know what is happening with your credit. Make sure it is being reported and address any mistakes as soon as possible. Get in the practice of taking a look at credit reports and digging into the particulars, and not just the scores.

We can help you monitor business credit at Experian and D&B for 90% less than it would cost you at the CRAs, here. Update the information if there are mistakes or the relevant information is incomplete.

Challenging Problems

So, what’s all this monitoring for? It’s to dispute any problems in your records. Mistakes in your credit report(s) can be fixed. But the CRAs usually want you to dispute in a particular way.

Disputing credit report mistakes normally means you send a paper letter with duplicates of any evidence of payment with it. These are documents like receipts and cancelled checks. Never mail the original copies. Always mail copies and keep the originals.

Disputing credit report inaccuracies also means you precisely itemize any charges you challenge. Make your dispute letter as understandable as possible. Be specific about the issues with your report. Use certified mail so that you will have proof that you mailed in your dispute.

More about Building Business Credit

Always use credit smartly! Never borrow beyond what you can pay back. Keep an eye on balances and deadlines for repayments. Paying off on time and in full will do more to boost business credit scores than just about anything else.

Growing company credit pays. Great business credit scores help a company get loans. Your lending institution knows the company can pay its debts. They know the company is bona fide.

The business’s EIN attaches to high scores, and loan providers won’t feel the need to request a personal guarantee.

A Word to the Wise

And finally, as with every other lending program, whether online or offline, remember to read all of the fine print and do the math. Go over the details carefully, and decide whether this option will be good for you and your company.

In addition, consider alternative financing options that go beyond lending. This includes building business credit. Building business credit can get your company credit cards. These come from vendors first, and then stores.

Then any business, even a startup, can get fleet and cash credit. Business credit is an asset and it increases company value.

However, ultimately, it is up to you to best decide how to get the money you need to help your business grow. And it is also up to you to consider how obtaining funding for your business will affect you and it in the days to come.

Today, we want to hear from our audience! Share your voice with us about your experiences with Bond Street and other online lenders.