BHG Business Loan Approval but I feel there will be a catch with this one

[FinStar]

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@wynnsand2020 wrote:

I just got another offer of 13.5% for 250k 5 years. Need to hold the loan for 2 years then no prepayment penalty. Doc fee of 3k.

However they do an UCC blanket lien on the business. Any idea what this means? Will it prevent me from getting another loan if I have this or perhaps lowering business credit?

what do you guys think about this loan?

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If they do a UCC blanket lien that means you wouldn't be able obtain another loan that may require the same pledged collateral. It also depends on the assets or collateral value and any UCC stipulations.

[wynnsand2020]

Wow if they put a lien on my business, I do not think the rate should be that high. As soon as they put an UCC lien am I prohibited to sell or transfer business asset? BHG advertises as unsecured business loan I guess it is not?!

[FinStar]

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@wynnsand2020 wrote:

Wow if they put a lien on my business, I do not think the rate should be that high. As soon as they put an UCC lien am I prohibited to sell or transfer business asset? BHG advertises as unsecured business loan I guess it is not?!

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You think most financial institutions will approve a $250K loan as unsecured for a business? That's a little unrealistic. Lower loan amounts may be unsecured, but again it depends on UW.

And, yes rates can fluctuate among different financial institutions depending on your business rating, assets, etc. And, if you have any assets pledged to any financial institution, you cannot sell them or transfer them without any type of loan modification. The UCC filing lets other creditors know what is pledged with your loan(s).

[SouthJamaica]

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@wynnsand2020 wrote:

I just got another offer of 13.5% for 250k 5 years. Need to hold the loan for 2 years then no prepayment penalty. Doc fee of 3k.

However they do an UCC blanket lien on the business. Any idea what this means? Will it prevent me from getting another loan if I have this or perhaps lowering business credit?

what do you guys think about this loan?

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What it means is they have a security interest in everything... your bank accounts, your accounts receivable, your equipment, etc.

[SouthJamaica]

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@wynnsand2020 wrote:

Wow if they put a lien on my business, I do not think the rate should be that high. As soon as they put an UCC lien am I prohibited to sell or transfer business asset? BHG advertises as unsecured business loan I guess it is not?!

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Yes you would be prohibited from selling or transferring assets without their approval.

[Falcon1871]

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@AzCreditGuy wrote:

So I got a call today saying that my business loan was approved, I sent in the app on 12/19/22 and was told it would take 2 to 3 days to process. I applied for $110k,  I dont know the rates or what loan amount I have been approved for as I will get that when I talk to a personal manager to go over numbers. Me being in Financials, I feel this is a red flag already. All other lenders have given me the amounts, rates and fees up front, so I am really effy about the apporval. I do have 60 days to accept the terms or not, I do want their business credit card though, but will not be getting one due to HP on personal. 

I will update this post, once I know the terms and amount. This was all done with a SP and signing some tax documents so they could check. In the end if I dont accept the loan, no harm done to my credit.

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I got their credit card (limit $24k), with 12 months of 0% interest on balance transfers. I transferred some balances. Everything looks ok now. 

I also applied for their loan twice. First one, they state that they couldn't get the verification of the company. But, it wasn't declined, so the rep said I still can apply. I did apply for the second time. The rep asked for my tax return, but I haven't done my last year's taxes yet. So, they asked for my year-to-date P&L. I got lazy and didn't send the P&L right away. Then, they sent me an email that they can't approve me, but they can refer me to their partner or something. After reading your post, I am glad I didn't go any further. 

So far I am happy with the credit card, and I am hoping I won't get any surprises. 

[Citylights18]

I wouldn't accept the terms BHG initially offered and they counter offered. Now granted this is back in 2021 when rates were super low and I did an 96 month term instead of stretching out to 12 years.

See below:

Waive the 48 month commitment period, so you can pay the loan off at any time and only pay interest on the time you carry a balance.

Lower your documentation fee from $2,995 to $750.

Provide you with a revised rate of 8.99%

Lower the Optional Limited Personal Guaranty from 7 to 4.51%

BHG offers the unique benefit of not reporting our loan as a tradeline on your credit report.

 It is important to remember the key benefits of our loan-

1. There is no personal collateral
2. Funds will not appear as a liability on your credit report
3. No Pre-Payment Penalty

[AzCreditGuy]

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@Citylights18 wrote:

I wouldn't accept the terms BHG initially offered and they counter offered. Now granted this is back in 2021 when rates were super low and I did an 96 month term instead of stretching out to 12 years.

See below:

Waive the 48 month commitment period, so you can pay the loan off at any time and only pay interest on the time you carry a balance.

Lower your documentation fee from $2,995 to $750.

Provide you with a revised rate of 8.99%

Lower the Optional Limited Personal Guaranty from 7 to 4.51%

BHG offers the unique benefit of not reporting our loan as a tradeline on your credit report.

 It is important to remember the key benefits of our loan-

1. There is no personal collateral
2. Funds will not appear as a liability on your credit report
3. No Pre-Payment Penalty

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That would be better....But they are in different times and even the guy was trying to say...Moneys more expensive now to loan...These are terms...Take it or leave......I ran away as fast as I could...

[AzCreditGuy]

Well the last saga of this "Lender" I got my reject letter for my $110k request, but how they can offer me $40k lol And how the credit decision was based in whole or part on information obtained from an "affilate" or from an outside source other than a consumer reporting agency? I find that interesting since they did everything in house and gathered tax records...

[SouthJamaica]

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@AzCreditGuy wrote:

Well the last saga of this "Lender" I got my reject letter for my $110k request, but how they can offer me $40k lol And how the credit decision was based in whole or part on information obtained from an "affilate" or from an outside source other than a consumer reporting agency? I find that interesting since they did everything in house and gathered tax records...

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Well, just be glad you're rid of them.