Is National Funding legit? It is not a federal program, and its name tells you nothing about whether it is safe. SBA’s 7(a) loan page says “You will always work directly with your lender and not with SBA,” so any National Funding offer is a private business deal, and you should check its records before you sign.
What is National Funding, and is it a government program?
No, National Funding is not a federal program. Federal small business loans come through a lender you choose, not through a federal office that calls you with an offer. Get the company’s legal name, state registration and working contact from its own website or your contract, and match them to each other.
Is National Funding legit, or is it a scam?
Settle this with the company’s records, and check them yourself. Find the owner, confirm the state registration, then read its Better Business Bureau and Trustpilot record under the exact legal name so you do not mix it with a company that has a similar name.
The Federal Trade Commission has acted against funders for these patterns. If a funder does any of them, stop and get a written explanation before you go on:
- Requiring personal guarantees and upfront fees after promising they would not, giving less funding than promised, and debiting more from the bank account than stated. In January 2022 the FTC’s 2022 merchant cash advance case banned RAM Capital Funding and its owner, Tzvi Reich, from the merchant cash advance and debt collection industries, with a $675,000 settlement.
- Deceiving businesses about how much funding they would get and how much would be collected. In February 2024 a federal court entered a $20.3 million judgment against merchant cash advance operator Jonathan Braun, after a jury found he knowingly violated the Gramm-Leach-Bliley Act. The judgment included $3,421,067 to redress the harm and $16,956,000 in civil penalties (FTC’s 2024 Braun judgment).
- Advertising access to 0% interest credit that clients did not get. In November 2025 Seek Capital and its CEO agreed to permanent bans from providing business financing, debt relief and credit repair services to settle FTC allegations (FTC’s 2025 Seek Capital case).
- Contracts with confessions of judgment, which the FTC says let a funder go straight to court and obtain an uncontested judgment on an alleged default.
Is National Funding a direct lender or a broker?
Ask National Funding which one it is, and get the answer in writing, because it tells you who holds your money and who collects it. A direct lender provides its own money. A broker places your application with another funder. Your contract should name the party that provides the money and the party that collects it. Texas H.B. 700, as described in the Senate Research Center’s bill analysis dated May 22, 2025 (Texas H.B. 700 bill analysis), would require broker registration of commercial sales-based financing brokers with the Office of Consumer Credit Commissioner.
Is a National Funding offer a merchant cash advance?
Ask this directly, and read the contract’s own wording and withdrawal schedule before you sign. The FTC describes merchant cash advance companies as providing funds to businesses in exchange for a percentage of the businesses’ revenue, with typically daily withdrawals from the business bank account until the obligation is met. The Texas bill analysis describes these products as an upfront cash payment in exchange for a percentage of future sales, “structured as ‘sales-based financing’.”
New York’s attorney general sued Yellowstone Capital and alleged that it was providing loans rather than merchant cash advances. The settlement, as the attorney general’s page describes it, canceled all merchant debts to Yellowstone, totaling $534 million. That page was last updated April 16, 2026 (New York attorney general’s Yellowstone settlement).
If you are comparing this product with other paths, the editorial team’s merchant cash advance alternatives guide covers the options side by side.
What does National Funding cost?
National Funding’s own written quote sets its cost, so get the total payback in dollars, the factor rate or interest rate, and every fee before you agree. Ask National Funding for today’s terms in writing. The table gives the federal baselines as of October 28, 2026.
| Option | Maximum amount | How you repay | Cost details as stated |
|---|---|---|---|
| SBA 7(a) loan | $5 million | Most term loans repaid with monthly payments of principal and interest | Working Capital Pilot rate caps: base rate plus 6.5% ($50,000 or less), plus 6.0% ($50,001 to $250,000), plus 4.5% ($250,001 to $350,000), plus 3.0% ($350,001 and greater). Upfront fee of 0.25% of the guaranteed portion on loans of 12 months or less |
| SBA 504 loan | Up to $5.5 million in the program text (the summary says $5 million) | Long-term, fixed rate financing for major fixed assets | For loans approved October 1, 2026 to September 30, 2027: upfront guaranty fee of 0.50%; annual service fee of 0.203% of the outstanding balance |
| SBA microloan | Up to $50,000; average about $13,000 | Maximum term of seven years | Generally 8% to 13%, varying by intermediary lender |
| Merchant cash advance | Set by the contract | Often a share of sales, commonly with daily withdrawals (FTC) | Factor rate and total payback set by the contract; get both in dollars in writing |
SBA’s 504 page gives $5 million in its summary and $5.5 million in its text, so confirm the figure with your lender. The microloan page adds that proceeds cannot be used to pay existing debts or to purchase real estate.
Rates move with the broader market. The Federal Reserve’s H.15 notes say prime “is one of several base rates used by banks to price short-term business loans.” On October 28, 2026, the Federal Reserve kept the target range for the federal funds rate at 3-3/4 to 4 percent. NFIB’s September 2026 small business survey reports that small business borrowers reported higher rates on their recently received loans.
What do business owners report about financing costs?
Most owners who borrowed from online lenders reported costs higher than they expected. The Federal Reserve Banks’ Small Business Credit Survey 2026 report covers the 2025 survey, fielded September 3 to November 14, 2025, with 6,525 responses from small employer firms. It is a convenience sample, not a random one, so read it as a picture of trends rather than a precise count. Its findings include:
- Sixty percent of firms applied for financing in the 12 months before the survey. Thirty-eight percent applied for a loan, line of credit or merchant cash advance.
- Forty-two percent of applicants received the full amount they sought, 36% received some or most, and 22% received none.
- Among firms that borrowed from online lenders, 60% reported higher-than-expected borrowing costs, while 4% found them lower than expected.
- Of firms that have debt, 59% used a personal guarantee to secure it, and 51% used business assets.
Does National Funding have a login, a phone number or reviews?
Take the login and phone number from the company’s own website or your contract, and make sure the name matches the legal name on your agreement. Do not use a number from an unexpected call or text. Check the Better Business Bureau and Trustpilot yourself, and look for complaints about funding amounts, withdrawals and payoff, the same problems the FTC cases describe.
What are the federal options and where can you get help?
The federal route is SBA lending through lenders you choose. SBA’s 7(a) loan page describes the program as SBA’s primary business loan program. SBA’s Lender Match tool matches you with a participating SBA lender. SBA District Offices provide in-person, online or telephone assistance, and SBA Resource Partners are available as well. The SBA grants page lists its awards to state and territory governments and to community organizations, so do not count on a grant from a funder. For a different working-capital route, see the net working capital guide.
What are your rights if a funding deal goes wrong?
Your remedies depend on your state. New York’s attorney general has settled a case against one merchant cash advance company, and its Yellowstone page tells merchants with a problem to file a complaint on the attorney general’s website.
- Texas: the bill analysis describes a requirement that providers disclose all costs and the frequency of payments to a recipient of less than $1 million, with fines of up to $10,000 for each violation. The analysis describes a bill, so check the Texas Legislature’s site to see whether it became law.
- Federal lending data: Section 1071 of the Dodd-Frank Act requires data on applications from women-owned, minority-owned and small businesses. A final rule issued May 1, 2026 extends the compliance date to January 1, 2028 (CFPB small business lending rulemaking).
What should you get in writing before you sign?
The editorial team’s position is simple: get every term in writing, read the contract before you sign, and compare it with the SBA row in the table. Ask for these items:
- The legal name, the owner and the state registration, matched to your contract.
- Whether the company lends its own money or brokers the deal, and who the funder is.
- The total payback in dollars, the factor rate or interest rate, and every fee.
- The payment amount and how often it is withdrawn from your bank account.
- What an early payoff costs.
- Whether you must sign a personal guarantee or a confession of judgment. Treat either as the biggest item to question before you sign.
- Refund and cancellation terms, in writing.
- Whether the contract calls the deal a loan or a merchant cash advance, in its own words.
Your next step is small: ask National Funding for the full written offer, with the total payback in dollars, and compare it with the SBA 7(a) row in the table above. This is general information, not personal financial or legal advice.
By USPatriotNews.com Editorial Team
