Alternative finance is a lending service outside of the traditional banking system. Here, borrowers and lenders connect directly and bypass the red tape that entails a federal financial structure. And here’s why we are telling you about it. Being an adult means living in debt and having more financial obligations than you can handle. Kidding! Not really. Before you start making $120K a year, and can afford your own personal financial adviser, we can help you figure out when alternative financing is useful for you. So read up, and thank us later. Here are 10 instances when alternative financing is a better option than going the traditional route.
Starting a Small Business: Traditional lenders are less equipped to mold to your specific business requirements. First, banks look for businesses seeking loans for a substantial amount, as a larger loan will enable them to make a larger profit. Second, as a borrower you are required to raise approximately 20 percent of the capital that you need, and produce collateral for the remaining 80 percent to the bank. And lastly, since the economic downturn, the cuts in funding opportunities have made it difficult for small businesses to get the capital they need from traditional sources. Nearly 7 out of 10 businesses get turned down when they go to the bank for a loan. At such times, the flexibility and accessibility of alternative lending can be your best avenue for capital. The process is quick and easy, and the capital as well as the payment plan can be tailored as per your business needs.
Credit Card Debt: Credit card debt has the potential to hurt your credit rating. The amount of credit you owe is one of the top factors that affects your credit score. So, when faced with increasing credit card debt, you will want to clear it off as quickly as possible. You are likely to come up against a brick and mortar wall (pun intended) when you reach out to the banks. As your credit score nosedives, so do your chances of getting a bank loan in the future. Through alternative financing, you can clear your high interest credit card debt with a single loan at a relatively lower interest rate, and not have a negative impact on your credit rating.
Business Expansion: If you have a thriving business like a cool pets hotel in Brooklyn, an artisanal mayonnaise spot, or a fashion label that’s becoming a trendsetter and wish to capitalize on its success, alternative financing would be a good way to go. You can focus on your expansion plans rather than drawing up paperwork for a traditional bank loan, and make good on precious time. The position of your business will help you get quick and competitive interest rates, and lending sites like LendingClub, Prosper, Kabbage, and Dealstruck are some of the options. In business, like most things in life, time is of essence.
Moving /Relocation: How well is the traditional financial system in the U.S. equipped to facilitate your desire to move to a different place in search of better opportunities? Not very. But that still leaves you in need of capital to cover moving expenses like shipping costs, security deposits and new furniture buys. Apart from the long wait, there is the chance that you will be rejected for a bank loan. So save yourself the time, trouble and heartbreak, and explore smart alternative financing options like marketplace lending.
Medical Emergencies: Emergencies happen, it’s part of life and it’s stressful. What doesn’t need to be stressful is dealing with the aftermath. Medical bills, doctor's visits, and prescriptions all start to add up and not everyone has the luxury of an emergency fund. You can take out a marketplace lending loan to cover these costs and help you get to a better tomorrow.
Maintenance/ Repairs: In case of repairs, be it home, vehicle or equipment, you’ll want to fix it before it goes completely bust. The average costs for such tasks can range anywhere from $10,000 to $50,000, depending on the type of repair. But when you request for a loan, banks are likely to say, ‘don’t fix it if isn’t broken.’ Now when this happens, you know where to go.
Equipment: Sometimes, all you need is a few thousand dollars to buy materials for your online jewelry store, high-end baking ovens for your bakery or a bunch of computers to start or strengthen your small but growing business – be it fashion, tailoring, catering or coding. In such instances, the flexibility of alternative financing companies like Fundera and OnDeck will lend well to your needs. You can get quick loans that will cover 100 percent of equipment value and with considerably less paperwork.
Child Care Cost: Starting a family is a delightful experience, but it comes with its share of financial responsibilities. The ever-increasing day care premiums that can range anywhere from $4,000 to $15,000 a year, can be overwhelming if you haven’t put money aside for it. As federal financing grapples to find a way to deal with this situation, you can resort to alternative financing for a solution. Through websites like Karrot you can apply for loans up to $35,000. It’s a simple three-step online application, which will take no more than a few minutes. Your application will be reviewed instantly, and if approved, you can have your money in a day’s time!
Your Big Idea!: Have a creative idea like building a virtual digital museum or something more altruistic like installing a community refrigerator to help alleviate hunger? Then crowdfunding websites like Kickstarter and Indiegogo is the place for you. Here, you can pitch your ideas through an online campaign and connect with a community of likeminded individuals who will not only encourage, but also fund your ideas. That’s more than any bank is going to do for you.
Wedding: This is definitely an expense and you’re not likely to get any return on your investment - not the monetary kind at least. Weddings are a lifetime event, a red-letter day in the calendar of your life, but for many a dream wedding hasn’t always been attainable due to budget restrictions. However, now you can always explore alternative financing options for those extra dollars to fund your nuptial through low interest wedding loans. Another option is crowdfunding. Some couples have launched online campaigns to help raise money for their big day, asking family and friends to donate towards their honeymoon in lieu of gifts.
Disclaimer: The material provided on this site is not intended to provide legal, investment, or financial advice or to indicate the suitability of any Even Financial product or service to your unique circumstances. For specific advice about your unique circumstances, you may wish to consult a qualified professional. Any information or statistical data sourced by Even Financial through hyperlinks, from third-party websites, are provided for informational purposes only. While Even Financial finds these sources to be accurate, it does not endorse or guarantee any third-party content.
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NEW YORK, NY, March 15, 2022 -- Even Financial ("Even"), the category-leading embedded finance marketplace and independently managed subsidiary of MoneyLion, Inc. (NYSE: ML), has announced a new partnership with Tally, a leading financial automation company, to include the company's low-interest credit offerings on its platform.
"Tally has built a powerful tech-enabled system to help people solve one of the biggest financial problems today: paying off credit card debt," said Phill Rosen, Founder and CEO of Even. "We're thrilled to welcome Tally's line of credit offerings to Even's unparalleled network of financial services providers."
Tally is designed to help its members pay off their debt faster and save them money on interest and late fees. Members can lower their monthly payment with Tally's lower-interest line of credit, if eligible. Typically, at least a 580 FICO score is needed. Tally's system is customized to save people as much money as possible.
"Americans today owe nearly $1 trillion in credit card debt. We know from our research that many want to pay down their debt but struggle to get started. That's where Tally comes in," said Jason Huynh, VP of Credit, Analytics & Operations at Tally. "Our system combines financial automation with a low-interest line of credit to give people the help they need to get on track to pay off their credit card debt for good. We're thrilled that our partnership with Even will allow Tally to help even more people."
The launch of Tally on the Even platform enables consumers to get matched with Tally's custom, low-interest line of credit accounts of up to $25,000 in just a few minutes. After getting matched, eligible consumers complete the process through the Tally app. There are no out-of-pocket costs.
Tally is the latest partner to join the Even marketplace, a growing network of over 400 financial services partners and 500 channel partners covering a breadth of financial services including loans, credit cards, mortgages, savings, and insurance products. Even's marketplace technology enables any company to add financial products to its business, with full compliance and security, at scale.
About Even Financial
Even digitally connects and matches consumers with real-time, personalized financial product recommendations from banks, insurance carriers, and fintech companies on mobile apps, websites, and other digital touchpoints through its marketplace technology. Even's infrastructure leverages machine learning and advanced data science to solve a significant pain point in financial services customer acquisition, seamlessly bridging financial services providers (such as SoFi) and channel partners (such as TransUnion) via its industry-leading API and embedded finance marketplaces. Even enables any company to add financial products to its business, with full compliance and security at scale. Even was named one of "America's Best Startup Employers'' by Forbes for 2021 and was named to the 2021 Deloitte Technology Fast 500, which recognizes the fastest growing tech companies in the world. Learn more at www.evenfinancial.com.
Tally is a consumer financial tech company pioneering full-service financial automation to help people save money, pay down their debt and reach their goals sooner. Founded in 2015, the company built the first fully automated debt manager to help put billions of dollars back in people's pockets. In 2021, Tally was named to Fast Company's Most Innovative Companies list and to Quartz's Best Companies for Remote Workers. Previously, Tally made Forbes' Next Billion Dollar Startup list, Forbes' Fintech 50 list, and the app won Real Simple's Smart Money award. Learn more at meettally.com.
NEW YORK, NY, April 19, 2022 -- Even Financial (“Even”), the category-leading embedded finance marketplace and independent subsidiary of MoneyLion, Inc. (NYSE: ML), has announced it has now facilitated over $5 billion in consumer credit, as of March 2022. Leveraging machine learning and advanced data science, Even solves a significant pain point in financial services customer acquisition by seamlessly bridging financial service providers and channel partners via its industry-leading API and embedded finance marketplaces.
“Surpassing $5 billion in consumer credit facilitated through our marketplace is an enormous achievement for Even as we continue to help build the future of finance technology,” said Phill Rosen, Founder and Chief Executive Officer. “Access to credit has long been a challenge for many hard-working Americans, and we are dedicated to alleviating this issue by providing consumers personalized financial services offers that meet their needs, when they need it most. Reaching the $5 billion milestone reaffirms that our mission is driving significant value for both consumers and our partners."
Even has grown its embedded finance marketplace offerings beyond loans to cover a breadth of additional financial services including credit cards, mortgages, savings, and insurance products. Within loans, Even offers the largest network of premium, connected loan providers - across a wide array of products including unsecured personal loans, secured personal loans, line of credit, student loan refinancing, and auto loan refinancing. Leading financial services providers, such as LendingClub and SoFi, partner with Even to reach qualified consumers searching for loans, benefiting from Even’s unparalleled network and native integrations.
The company has continued its rapid growth trajectory in 2022, growing its network to include over 400 financial services partners and 500 channel partners. Even's marketplace technology enables any company to add financial products to its business, with full compliance and security at scale. Earlier this year, Even announced the close of its acquisition by MoneyLion, the award-winning digital financial platform, which will continue to advance their combined efforts of providing financial access and advice to hard working Americans.
About Even Financial
Even digitally connects and matches consumers with real-time, personalized financial product recommendations from banks, insurance carriers, and fintech companies on mobile apps, websites, and other digital touchpoints through its marketplace technology. Even's infrastructure leverages machine learning and advanced data science to solve a significant pain point in financial services customer acquisition, seamlessly bridging financial services providers (such as SoFi) and channel partners (such as TransUnion) via its industry-leading API and embedded finance marketplaces. Even enables any company to add financial products to its business, with full compliance and security at scale. Even was named one of "America's Best Startup Employers'' by Forbes for 2022 and was named to the 2021 Deloitte Technology Fast 500, which recognizes the fastest growing tech companies in the world. Learn more at evenfinancial.com.