Balboa Capital Reviews - Financial Lender Pros & Cons
- All credit scores considered
- Wide range of equipment financing deals
- Quick turnaround time
- Lower qualification requirements
- Range of services
- Fast response
- Ideal for small businesses
- Lack of clarity about fees and rates
- Poor reputation thanks to a recent lawsuit
- Can be difficult to reach customer service reps
Balboa Capital is a direct lender in the business space that's been around since 1988. It lends money to small to medium businesses for a range of commercial and business purposes, with a maximum loan amount of $1 million for specific products.
Balboa Capital gathered a lot of negative publicity in 2017, when it was named in a class action lawsuit together with 2 other lenders for financing a vendor named MHT that targeted doctors with a scam business opportunity. It has since worked hard to clean up its act and satisfy the regulatory bodies, but there's still a lot of bad feeling towards the company.
Balboa Capital avoids large corporations and instead aims at small to medium businesses that need dedicated, unhurried advice.
Balboa Capital offers a range of commercial financing products, including:
- Short-term business loans
- Commercial business loans
- Lease lines of credit
- Capital equipment financing
- Operating leases
- Franchise and vendor financing
Some commercial services allow you to borrow up to $1 million, but for equipment financing you can borrow up $250,000. Equipment financing options include:
- $1 buyout
- Wrap leases
Sales-leaseback and wrap leases are more difficult to find for equipment leasing, but are very useful for business owners in specific circumstances. If you have a large amount of fixed assets but poor credit, you'll appreciate sales-leaseback programs, while wrap leases are helpful for existing borrowers who may need to borrow more in the near future.
You can use Balboa Capital's equipment financing for:
- Computers and technology
- Software and tech licenses
- Commercial vehicles
- Office equipment
- Furniture, fixtures, and fittings
Balboa Capital serves most industries, including construction, mining, tech, pharmaceuticals, and oil and gas. It's geared primarily towards small and medium-sized businesses, rather than large corporations, and it's not well suited to startups since it requires at least $100,000 in annual revenue.
Balboa Capital commonly works together with equipment vendors, middle market executives, small business owners, and franchise owners.
Balboa Capital focuses far less on your credit score, and far more on the overall health of your business. To quality for equipment financing, you'll need:
- At least 1 year in business
- $100,000 or more in annual revenue
- A credit score of at least 560
However, Balboa Capital does say that they'll consider any credit score. Bear in mind that if your credit score is poor, you'll face far higher rates.
You won't need to provide a personal guarantee, only a corporation guarantee, which is a relief for most business owners. Most equipment financing deals don't require any collateral or down payment, although Balboa Capital doesn't explain when you might be asked for a down payment or how much it might be.
Terms & Fees
- Amount: up to $250,000
- Term length: 24-72 months
- Interest rate: around 8% to 38%, but it depends on your credit score, loan size, and term length
- Down payment: Unknown
- Buyout agreement: $1 Buyout; Fair market value; Sale-leaseback;Wrap lease;
- Additional costs: Unknown
- Effective APR: Unknown
Terms and Fees Summary/considerations.
Balboa Capital offers highly competitive rates, as long as your credit score and annual revenue are strong enough. You can pick the length of your term, the amount you borrow, and the type of equipment financing package according to your needs. Instead of giving you a specific interest rate, Balboa Capital will tell you your monthly payments, which remain fixed throughout the term of your loan. It's up to you to use them to calculate your final APR.
One of the biggest strengths of Balboa Capital is the speed with which you'll receive your funding. Applying for a loan is done through an online form which takes just a few minutes to complete. The application process is automated, so you'll receive an answer and could even see funding come through all on the same day.
You won't need to send in any extra financial paperwork, collateral, or down payment for most equipment financing loan applications. The application form asks for your basic business information, how much you want to borrow, the number of years you've been in business, annual revenue, type of equipment you intend to buy, etc.
You'll also need to answer questions about your personal identity and explain how much of the business you own.
If you have a co-owner, you'll need to share their information as well. The two of you have to own at least 50% of the business between you to receive equipment financing from Balboa Capital.
If you're borrowing more than $75,000, you can expect to be asked to prove that you've been accepted to borrow similar amounts in the past, and there are obligatory site inspections for businesses applying for more than $50,000.
Sales & Advertising Transparency
Although there's no information about the typical APR or interest rates, Balboa Capital does offer an equipment loan calculator, so that you can estimate the amount you'll have to pay each month for different loan amounts and loan terms.
You'll find most of the information you need to make a fully informed decision on the website.
Customer Service & Technical Support
You'll find customer service through a number of channels. You can use the on-site live chat, or call or email the company. You can also complete a webform to submit your question. A number of reviews point out that it's difficult to get through to a human agent, but it seems that the customer service is very good once you do get through.
Balboa Capital also has a very useful set of resources for business owners. As well as the equipment financing calculator and business loan calculator, there are also many infographics and white papers to help businesses make the best decisions for their financial stability.
Balboa Capital has an overall rating of 4.5 on TrustPilot, but only 1 star in customer ratings on BBB and a similar picture of 1.5 stars on Yelp. Balboa Capital is an accredited company with BBB and has an A+ rating with the company, after having settled a bunch of regulatory issues that the ratings company had raised.
Negative Reviews & Complaints
There are dozens of negative reviews and complaints about Balboa Capital on TrustPilot, Yelp, and BBB. Most of them complain about getting slapped with unexpected termination fees or interest charges, or being told at the last moment that the buyout deal is actually an FMV lease that has at least another year to go. Other customers mention extreme actions like attempting to charge the customer for leasing items that the customer already owns.
In the last few months, a number of Balboa Capital customers have complained about a lack of empathy and consideration for small businesses during the pandemic. A few customers said that they were forced to close down their business and requested a few extra months to pay off their equipment financing arrangements, but were met with hard pressure to pay in full and on time.
Balboa Capital does seem to resolve most of the issues, but the sheer number of complaints should give you pause.
Positive Reviews & Testimonials
It's not all doom and gloom. TrustPilot in particular displays far more positive than negative user reviews. Happy Balboa Capital customers highlight how quick and smooth the application and approval process is, and express gratitude for receiving equipment financing funds so swiftly.
Although a number of customers struggled to reach customer support, once they did get through they were largely satisfied with the service they received, praising their customer service rep or sales agent for being helpful, friendly, and efficient.
If you're a small to medium business looking for fast funding for equipment financing, and your credit score and annual revenue are both strong, Balboa Capital could be exactly what you need. But the large number of complaints about unexpected fees and opaque rates, as well as the recent lawsuit, should warn you to tread with care and keep a copy of all your correspondence.