Are you a contractor considering offering financing to your customers but not sure where to begin? If yes, you’re in luck. Trades.org has done the heavy lifting for you filtering the top companies that help you offer your customers financing so you can take advantage of closing more deals and increasing revenue. We’ve broken down each company by factors such as general offering, pricing and loan terms such as their annual percentage rate (APR), perks that they offer and pros and cons.
How does consumer financing help your business? A recent study by PayPal showed that the average size of purchase orders increased by 15% when small businesses started offering customer financing. In addition, over 90% of customers who used consumer credit services said they plan to do so again. To put is simple, if your customer doesn’t have the money to pay you on hand, having the ability to offer them financing options can help you close more deals and increase project size. Get ready to learn how these companies offer partnership programs that help you offer financing to your customers.
Home Improvement Financing Partners for Contractors
- GreenSky - Direct platform with federal partners
- Acorn Finance - Free brokerage partnered with LightStream, bestegg, Upgrade, Prosper and SoFi
- Hearth - Brokerage partnered with LendingClub, Prosper, LendingPoint, LightStream, Upgrade, UpStart, Axos Bank, SoFi, OneMain Financial, Avant, freedomplus, bestegg and Netcredit
- Enhancify - Brokerage partnered with Prosper, Payoff, Marcus by Goldman Sacs, LendingPoint, Upgrade, SoFi, Avant, OneMain Financial and bestegg
- Supermoney - Free Brokerage partnered with Lendkey, GreenSky, SoFi, LightStream, Prosper, Earnest, Upgrade, Avant, NetCredit and opploans
- EnerBankUSA - Direct platform and lender
- Synchrony - Credit card provider and lender
Greensky
Greensky is a leading company in the consumer financing space focusing on home improvement financing and retail. Greensky partners with federally insured and federal and state chartered bank partners who provide loans to customers of the merchants in their network across all 50 states. “Merchants” are contractors who can offer financing to their customers at promotional rates provided by Greensky.
Pricing, Loan APR, and Terms
Similar to credit card payment merchant fees, Greensky charges a dealer fee everytime you process a transaction on a customers Greensky loan. You can get more details on this dealer fee by contacting Greenskys sales department. We’ve seen that the fee can be anywhere from 2-10% per transaction depending on the pricing menu you choose when getting started.
Greenskys APR rates can range from 3.99% to 26.99% and the 2-10% dealer fee, and the terms can range from 3 to 7 years. There is also an account activation fee of $39 at time of first purchase.
Greensky does offer deferred interest loans and reduced interest loans if you need a longer time to pay back your loan. Deferred interest loans accrue interest charges during a 6, 12, 18, or 24 month promotional period. If a customer pays off their loan before the period ends, they pay no interest. If they don’t pay the loan off, the customer pays the interest accrued over the promotional period plus any interest accrued after over an 84 month period.
Loan Amount
Greensky gives contractors the ability to offer loans amounts of $3,500 to $65,000 to their customers.
Custom Branded Webpage
Greensky offers co-branded landing pages for those who want to advertise their partnership and offer financing on their website.
Credit Score Impact
Customers can immediately pre-qualify online without affecting their though a soft inquiry or soft pull.
How to Qualify
- Contractor merchants must be in business for at least 2 years and have $1M in revenue to date to qualify to offer financing with Greensky
- For loans, Greensky typically accepts 680 credit scores and above
Pros and Cons
Pros
- Available in all 50 states
- No interest loans
- Fast funding
Cons
- 680 credit score limit can be a barrier for some customers
- Deferred interest loans can backfire
- Negative reviews and lawsuits regarding customer service and a lack of transparency
How to get Started
Greensky is said to take 2-3 business days to get started after reviewing and signing their contracts and finishing their application. You can learn more about Greensky’s Merchant Program and apply by filling out a quick form on their website.
Acorn Finance
Acorn Finance is a free home improvement financing platform for contractors and dealer. Acorn Finance allows contractors to offer their customers multiple quotes from industry leading personal loan providers such as LightStream, Money2020, SoFi and more.
Pricing, Loan APR and Terms
Acorn financing is 100% free to contractors allowing you to keep 100% of your profits. They do not charge any sign-up fees, subscription fees, or dealer fees.
Acorn Financing advertises rates as low as 4.99% and terms as long as 12 years. Interest rates vary based on the credit plan.
Loan Amount
Acorn Financing gives contractors the ability to offer loans up to $100,000 to their customers in 90% of U.S. states. These are pre-qualified, unsecured, personal loans that can technically be spent anywhere the customer would like.
Custom Branded Webpage
Acorn Finance provides your company with a free online portal and training for your sales reps and agents.
Credit Score Impact
Customers can immediately pre-qualify online without affecting their credit score- soft pull.
How to Qualify
- For loans, Acorn financing typically accepts 650 credit scores and above
- Customers fill out a short pre-application form and get multiple pre-qualified quotes in seconds
- The customer can filter loans by interest rate, loan term, and payment amount, and once provider is selected, Acorn finance connects the two parties
Pros and Cons
Pros
- 100% free, no fees
- In 90% of U.S. states
- Soft credit pull
- Fast funding, as short as same day
Cons
- Is not the loan provider, however, is partnered with industry leaders
- Can be confused with the Acorns Investing application
How to Get Started
Acorn Finance makes it simple for you to get started with no paperwork directly on their website.
Hearth
Hearth is a financing brokerage platform that allows for urgent home improvement and repair financing. Hearth has a robust network of financial lending partners and charges a yearly fee to contractors for its services.
The process is simple:
- Contractors find customized payment plans for their customers
- Customers complete a short online financing request and get immediately pre-qualified by up to 13 lending partners (without affecting their credit score)
- Customers apply for their preferred loan option and if approved, receive funding in as little as 24 hours
Pricing, Loan APR and Terms
Contractors must to pay a yearly fee for Hearth’s services. Prices advertised on their website are shown below:
- Essentials: $799/ year
- Pro: $999/ year
- Elite: $1,499/ year Hearth APR rates are advertised to be as low as as 4.99% APR with terms ranging from 2 to 12 years. However, customers have stated that rates can be as high as 36% APR. Interest rates vary based on your credit score and terms.
Loan Amount
Hearth gives contractors the ability to offer loans from $1,000 to $100,000
Custom Banded webpage
Hearth does not offer co-branded landing pages. However, unlike its many of its competitors, Hearth has the option to leverage their mobile application.
Credit Score Impact
When your customer submits a loan request through Hearth, their lending partners do a soft pull on their credit which does not affect their credit score.
How to Qualify
- Hearth will work with anyone from people just starting out all the way up to industry veterans
- For loans, FICO scores as low as 500 can qualify
Pros and Cons
Pros
- Fast funding
- Low rates
- Mobile application
- Works with most contractors
- Soft pull
- Takes a little as 5 minutes to get started
Cons
- Yearly fee to contractors
- Some negative reviews regarding high rates
- Not a registered lender
- Payments take up to 2 weeks
How to get Started
Hearth takes as little as 5 minutes to get started. [Apply by filling out a quick form on their website.(https://www.gethearth.com/contractors/financing)
Enhancify
Enhancify’s mission is to simplify the process of how you can search, compare, and apply for a loan. The company aims to give you the best chance of getting the money you need at the best rates and terms available to you.
Pricing, Loan APR and Terms
Enhancify’s membership plan “Enhancify Gold” is $1,499/year from the date of set up. It Includes a co-branded landing page, custom marketing materials, training materials, dedicated customer assistance, and more. Enhancify’s APR rates are advertised to be as low as as 5.99% APR Rates have been seen to be as low as 4.99%. 0% financing is available and can take as little as 60 seconds to apply with money deposited in as quickly as 24 hours.
Loan Amount
Hearth gives contractors the ability to offer loans from $1,000 to $100,000
Custom Branded Webpage
Enhancify offers co-branded landing pages along with a variety of other marketing materials, perks, and services.
Credit Score Impact
When your customer submits a loan request through Enhancify, their lending partners do a “soft pull” on their credit. This will not affect their credit score.
How to Qualify
- Available to brand new contractors in the market
- For loans, credit scores as low as 520 can qualify
Pros and Cons
Pros
- Kickback- you earn $50 for every person who uses financing
- Fast funding 2-3 business days from strong partners
- Available to contractors who just started
- 0% interest financing available
- Offers marketing materials, trainings, and customer support
- No dealer fees
- Soft pull
Cons
- Hefty yearly fee to contractors compared to competitors (cancels out with kickback and new jobs)
- Is a broker not a lender
- Rates are advertised slightly above competitors
How to get Started
You can start in just 60 seconds by signing up online here.
Supermoney
Supermoney is a contractor financing platform that aims to boost sales, improve cash flow, and fund your customers fast. With a focus on home improvement financing, Supermoney offers a competitive brokering and quote comparing platform backed by industry leading partners.
Pricing, Loan APR and terms
Supermoney financing is free to contractors allowing you to keep 100% of your profits. They do not charge any sign-up fees, subscription fees, or dealer fees.
Supermoney advertises rates as low as 5.99%, however, online reviews claim that the rates can be as much as 20% with good credit. Rates are dependent on a variety of factors including credit plan, terms, and lender.
Loan Amount
Supermoney gives contractors the ability to offer loans from $1,000 to $100,000
Custom Branded Webpage
Supermoney does offer co-branded landing pages
Credit Score Impact
When your customer submits a loan request through Supermoney, their lending partners do a soft inquiries on their credit. This will not affect their credit score. However, people have voiced their concerns with Supermoney asking for a social security number for quotes.
How to Qualify
- Available to brand new contractors in the market
- For loans, Supermoney claims it can help with all types of credit
Pros and Cons
Pros
- Free for contractors
- Available to contractors who just started
- Co-branded page offered
- Paperless
- Soft pull
Cons
- Supermoney is also a broker that provides quote comparisons
- No kickback
- Ask for social security number
How to Get Started
You can start in just with Supermoney by filling out their short form here.
EnerBankUSA
EnerBankUSA offers a payment options program and is a member of the Federal Deposit Insurance Corporation (FDIC). EnerBankUSA is a specialized home improvement lender and about 4/5 applicants are approved to their payment options program, allowing contractors to offer financing to their customers.
Pricing, Loan APR and Terms
EnerBankUSA charges a dealer fee for their contractor payment options programs. This dealer fee varies depending on terms you want to offer when signing up.
On average, for 0% interest same as cash loans, for 12 - 18 months, dealer fees are about 6%. Meaning that when EnerBankUSA ACH’s money to the contractor, 6% is taken. An ACH transfer is an electronic, bank-to-bank money transfer that's processed through the Automated Clearing House Network.
0% interest installment loans can go up to 7 years, average anywhere from 5-12 years and APR can range anywhere from 1.9% to 9.99% depending on what terms you choose to offer.
A popular loan is for 5 years at 9.99% with a dealer fee of about 1.75%. There is a trade off between what APR you offer your customer and the dealer fee you want to incur.
For 12 months, 0 interest loans and same month 0 interest loans, the customer accrues interest at about 17.9%/month, so customers need to make sure that they are going to pay off their loan in 12 months.
Loan Amount
EnerBankUSA gives contractors the ability to offer loans from $1,000 to $100,000 and advertises an average increase of 30% or more in project size.
Custom Branded Webpage
EnerBankUSA offers marketing materials, links, and banners and a co-branded website to partners.
**Credit Score Impact **
EnerBankUSA conducts a hard pull over the phone, online, or through the mobile app, which can have a negative effect on customers’ credit scores.
How to Qualify
- Must have a residential home remodeling focus for your business
- Must be in business in the U.S. for at least 3 years
- Must have an average project size of at least $5,000
- Must have residential remodeling sales of at least $500,000 to date
Pros and Cons
Pros
- Industry leading point of sales partner, Leap
- Member of FDIC
- Marketing materials offered
- Industry leader
- Zero interest loans offered
- Gives choices in payment options
Cons
- Dealer fee can be large if you want to offer a low APR
- Not too much information posted on their website
- No kickback
- Hard pull on credit
How to Get Started
You can get started with EnerBankUSA by filling out their contact form here.
Synchrony Home Specialty Program
Synchrony Bank offers a suite of merchant tools to help with sales and operations when you become a merchant for any of their financing programs. Synchrony Home Specialty Programs helps you build a better bottom line for your HVAC, home improvement, or lawn and garden business with their dedicated tools and the ability to offer a line of credit. With your store name on a branded credit card, you can be on top of your customers’ minds for repeat purchases.
Pricing, Loan APR and Terms
There are no fees related to the application process. There are pricing menus that must be selected during the application process that show a percentage the customer must pay and a merchant fee associated with the offer.
APR on the customer account side is 26.99% and based on the pricing menu the contractor selects there are different promotions that effect interest and dealer fees. The dealer fees can range from 4.5% to 9% per transaction. There is also a minimum monthly spending amount that customers have to meet and if they don’t, it will result in a $40 fee.
Financing options include:
- Deferred interest
- No interest
- Reduced interest
- A breakdown of the financing option can be found here
Loan Amount
Credit lines are based on consumer credit quality and estimated sale amount. Credit lines are up to $35,000 for initial approval and customers must reach out to customer service if they need a credit increase.
Custom Branded Webpage
Synchrony Bank does not offer a co-branded webpage, but they do offer a variety of online resources for their Home Specialty program including a Business Center for managing your account, a Toolbox for marketing collateral, and a Learning Center for enablement.
Credit Score Impact
Synchrony Bank customers are subject to a hard inquiry since they are requesting new line of credit. It’s a hard pull for the contractor when applying to be a merchant as well.
How to Qualify
- No time in business or a set amount of money in order to get set up. Contractors must fill out the enrollment application and credit check. It takes between 24-48 hours you can start offering credit cards with your business name. You must call 866-209-4457 to get started and return an application through fax or email. You will get a merchant number if accepted where you register using that number on the Business Center.
- Personalized cards are an option for companies recording $50M annually
- Two forms of ID needed for customers to apply for credit
Pros and Cons
Pros
- Resources and tools for success
- Fast funding and line of credit
- Custom credit cards with reputable brand
- Online platform for applying for credit, completing sales slips, a payment estimator, and managing your sales and pipeline.
Cons
- Dealer fee can be large if you want to offer a low APR
- Not too much information posted on their website
- No kickback
- Hard pull on credit
How to Get Started
You must call 866-209-4457 to get started and return an application through fax or email. You will get a merchant number if accepted in which you use that number to register on the Business Center. It takes between 24-48 hours until you can start offering credit cards with your business name. More info on the program can be found here.
The Bottom Line
When you offering financing, customers are more likely to make purchases they may have initially thought were too expensive. This can help you increase the dollar size of your projects, help you close more deals and ultimately differentiate your company from the competition. The bottom line is that offering contractor financing to customers can bring in more revenue to your business. Get started by contacting a few of these companies to learn more about how you can start offering financing to you customers today.