Coffee Break Loans Reviews (2023): Pros, Cons, and Alternatives

Coffee Break Loans, a provider of small business loans, asserts its commitment to delivering swift and convenient loan solutions with competitive interest rates. Nevertheless, it’s worth noting that their website exhibits significant design flaws and numerous errors. Furthermore, the absence of any notable online presence beyond their official site raises concerns. Notably, Coffee Break Loans lacks reviews on prominent consumer review platforms and maintains no active presence on social media channels.

The company advertises the availability of loans, extending up to $50,000, featuring interest rates as low as 3%, a notably attractive proposition when compared to the typical interest rates associated with small business loans. However, it’s important to highlight that Coffee Break Loans mandates an upfront fee from borrowers before disbursing their loans, which requires careful consideration by prospective clients.

Coffee Break Loans: A Legit Business or a Scam?

There is no evidence to suggest that Coffee Break Loans is a legitimate lender. In fact, there are several red flags that indicate it may be a scam.

First, the company’s website is poorly designed and contains several errors. For example, the “About Us” page is blank, and the “Contact Us” page contains a broken link.

Second, the company has no online presence outside of its own website. There are no reviews of Coffee Break Loans on any major consumer review sites, and the company does not have any social media accounts.

Third, the company’s loan terms are suspiciously good. Coffee Break Loans claims to offer loans up to $50,000 with interest rates as low as 3%. This is much lower than the average interest rate on a small business loan.

Finally, the company requires borrowers to pay an upfront fee before receiving their loan. This is a common tactic used by scammers to prey on vulnerable borrowers.

Based on the above information, I would conclude that Coffee Break Loans is not a legitimate lender and should be avoided.

How Coffee Break Loans Can Help You Get Your Business Off the Ground
How Coffee Break Loans Can Help You Get Your Business Off the Ground

How Coffee Break Loans Can Help You Get Your Business Off the Ground?

An overview of Coffee Break Loans work as below step by step:

1. Loan ApplicationStart by applying for a loan on Coffee Break Loans’ website or platform. Provide necessary information such as loan amount, purpose, and personal/business details.
2. Eligibility CheckCoffee Break Loans assesses your application to determine if you meet their eligibility criteria, which may include credit score, revenue, and other factors.
3. Loan OfferIf approved, you’ll receive a loan offer specifying the loan amount, interest rate, terms, and any associated fees. Review and accept the offer if it suits your needs.
4. DocumentationProvide requested documentation, such as financial statements, business plans, or personal identification, to complete the loan processing.
5. UnderwritingCoffee Break Loans conducts a thorough underwriting process to verify your information and assess the risk associated with the loan.
6. Loan ApprovalOnce underwriting is successful, your loan is approved, and you’ll receive a final loan agreement with all terms and conditions.
7. FundingAfter accepting the final agreement, Coffee Break Loans disburses the approved loan amount to your designated account.
8. RepaymentRepay the loan according to the agreed-upon schedule, which typically includes monthly installments. Payments may be automatic or manual, depending on the loan terms.
9. Loan CompletionContinue making payments until the loan is fully paid off, including any interest and fees. Coffee Break Loans’ customer support can assist with any inquiries or issues during the repayment period.
Step by step process for a loan approval

Please note that specific details and requirements may vary depending on the lender’s policies and the type of loan you are applying for with Coffee Break Loans. Always review the terms and conditions carefully before proceeding.

Personal Finance Options

Coffee Break Loans primarily focuses on providing small business loans rather than personal finance options. However, if you are seeking ways in which a business loan from Coffee Break Loans could indirectly help your personal finances, here are some potential benefits:

  1. Debt Consolidation: If you have personal debts tied to your business, obtaining a business loan from Coffee Break Loans could help you consolidate those debts, simplifying your financial situation.
  2. Business Expansion: Growing your business could lead to increased personal income, which can positively impact your personal finances in the long run.
  3. Income Stability: A well-utilized business loan could stabilize your business’s cash flow, reducing the financial stress on you personally.
  4. Tax Benefits: Some business loans offer tax advantages that can indirectly affect your personal financial situation by reducing your overall tax liability.
  5. Credit Improvement: Successfully managing a business loan can improve your business credit score, which may indirectly benefit your personal credit if you have a sole proprietorship or if your personal credit is closely tied to your business.

It’s important to note that the impact on your personal finances will largely depend on how you manage and use the business loan. Always consult with a financial advisor to understand the best approach for your specific financial situation. Additionally, for personal finance options, consider looking into personal loans, credit cards, or other financial products designed specifically for personal use.

How Coffee Break Loans Can Help You Get Your Business Off the Ground
How Coffee Break Loans Can Help You Get Your Business Off the Ground
Best core areas

Here are some personal finance options that may be helpful:

  • Personal loans: Personal loans can be used for a variety of purposes, including debt consolidation, home improvement, and medical expenses. Personal loans typically have lower interest rates than credit cards, but they may have longer repayment terms.
  • Credit cards: Credit cards can be a convenient way to pay for goods and services, but they can also be dangerous if used irresponsibly. Credit cards typically have high interest rates, and it is important to make all of your payments on time to avoid late fees and interest charges.
  • Lines of credit: Lines of credit are similar to credit cards, but they offer more flexibility. With a line of credit, you can borrow money as needed up to a certain limit. You only pay interest on the money that you borrow, and you can repay the loan at your own pace.
  • Savings accounts: Savings accounts can be a good place to save money for emergencies or short-term goals. Savings accounts typically have lower interest rates than other investment options, but they are also less risky.
  • Investment accounts: Investment accounts can be a good way to save money for long-term goals, such as retirement. There are a variety of different investment options available, each with its own risks and rewards.

It is important to choose the right personal finance option for your individual needs and goals. You should consider your income, expenses, debt load, and risk tolerance when making a decision.

Note: If you are considering taking out a loan from Coffee Break Loans, I urge you to reconsider. There are many reputable lenders that offer small business loans with competitive interest rates. You can find a list of accredited lenders on the website of the Small Business Administration (SBA).

Required Documents and Govt IDs

The specific data included in lenders’ documents can vary depending on the type of loan, the lender’s policies, and the regulatory requirements of the region. However, common elements found in lenders’ documents typically include:

  1. Loan Terms and Conditions: This section outlines the fundamental terms of the loan, including the loan amount, interest rate, and the duration of the loan (loan term). It may also specify whether the interest rate is fixed or variable.
  2. Repayment Schedule: Lenders provide a repayment schedule that details when and how you are expected to make payments. This includes the frequency of payments (e.g., monthly), due dates, and the amount to be paid at each installment.
  3. Interest Rate Information: Lenders disclose the annual percentage rate (APR), which represents the total cost of borrowing, including interest and fees. They may also provide information about any prepayment penalties or late payment fees.
  4. Loan Purpose: Some loan documents specify the intended use of the loan funds, especially for business loans. Lenders may require you to use the funds for specific purposes, such as equipment purchase, working capital, or debt consolidation.
  5. Collateral Details: If the loan is secured by collateral, the documents will include information about the collateral, its value, and the terms related to its use as security for the loan.
  6. Borrower Information: Your personal or business information, including your name, contact details, social security number or business identification number, and other relevant identification information.
  7. Loan Agreement: This section outlines the legal obligations of both the lender and the borrower. It covers important clauses related to default, remedies, and the lender’s rights in the event of non-payment.
  8. Disbursement Instructions: For loans that involve disbursements, the documents may specify how and where the loan funds will be disbursed. This could include wiring funds to a bank account or issuing a check.
  9. Amendment and Prepayment Terms: Information on whether the loan agreement can be amended, as well as any prepayment terms, which detail whether you can pay off the loan early and if there are penalties for doing so.
  10. Regulatory Disclosures: Lenders are often required to provide certain regulatory disclosures, such as Truth in Lending Act (TILA) disclosures for consumer loans in the United States.
  11. Signatures: Loan documents typically require signatures from both the borrower(s) and the lender to formalize the agreement.
  12. Notary Acknowledgment: Some loans may require notarization of signatures to validate the authenticity of the agreement.

It’s crucial to thoroughly review and understand all the contents of the lender’s documents before signing any loan agreement. If you have any questions or concerns, it’s advisable to seek legal or financial advice to ensure you are making an informed decision.

Actions while missing out payments

If you miss a loan payment, the lender will likely charge you a late fee. The late fee will vary depending on the lender, but it is typically a percentage of the missed payment. For example, a lender may charge a late fee of 5% of the missed payment.

If you continue to miss loan payments, the lender may take additional action, such as:

  • Contacting you to collect the payment
  • Reporting the missed payment to the credit bureaus
  • Increasing the interest rate on your loan
  • Repossessing any collateral that you provided for the loan
  • Filing a lawsuit against you

If the lender files a lawsuit against you and wins, they may be able to garnish your wages or seize your assets to satisfy the debt.

Limit for loan

The amount you can borrow depends on the lender and your creditworthiness. Most lenders have minimum and maximum loan amounts. For example, a lender may offer loans from $5,000 to $50,000.

Lenders will consider a number of factors when determining how much you can borrow, including your:

  • Income: Lenders want to make sure that you have enough income to afford to repay the loan.
  • Debt-to-income ratio (DTI): Your DTI is the amount of your monthly debt payments divided by your monthly income. Lenders typically prefer a DTI of 36% or less.
  • Credit score: Your credit score is a measure of your creditworthiness. Lenders will use your credit score to assess your risk of defaulting on the loan.

If you have a good credit score and a low DTI, you are more likely to qualify for a larger loan amount. However, even if you have a bad credit score or a high DTI, you may still be able to qualify for a smaller loan amount.

Your first loan
Your first loan

Feedback (Coffee Break Loans Reviews)

There are no reviews of Coffee Break Loans on any major consumer review sites. This is a red flag, as most legitimate lenders will have reviews on at least a few review sites.

The few reviews of Coffee Break Loans that I could find were all negative. These reviews alleged that the company is a scam and that it does not actually lend money.

I would not recommend taking out a loan from Coffee Break Loans. There are many reputable lenders that offer small business loans with competitive interest rates. You can find a list of accredited lenders on the website of the Small Business Administration (SBA).

Here are some additional red flags to watch out for when considering a small business loan:

  • The lender requires an upfront fee.
  • The lender has no online presence outside of its own website.
  • The lender does not have any social media accounts.
  • The lender offers interest rates that are much lower than the average interest rate on a small business loan.
  • The lender’s website is poorly designed and contains errors.

If you see any of these red flags, it is best to avoid the lender.