Untold Truths - Banking & Funding

EIN-based funding is often promoted online as funding that completely bypasses personal credit. While EIN-based products do exist, this description oversimplifies how these products work. EIN-based funding generally means that a lender evaluates the business as a separate entity using its Employer Identification Number. This may reduce reliance on personal credit, but it does not always eliminate it. Depending on the lender and product, evaluations may still include: Personal

A common claim online is that banks are legally required to provide small businesses with funding in specific dollar amounts, often cited as $50,000 to $250,000. This claim is misleading. Banks are not legally required to approve funding  simply because a business exists or applies. What banks are required to do is: Follow fair lending and anti-discrimination laws Clearly disclose loan terms and conditions Evaluate applicants using consistent criteria Provide adverse action n

The phrase “no-doc funding” is widely used across social media, often implying that businesses can receive funding without providing any information at all. This is not an accurate representation of how banking works. In traditional banking and lending, financial institutions are required to verify identity, business legitimacy, and risk. What “no-doc” typically refers to is reduced documentation , not the absence of review. In many cases, reduced-documentation products may r