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At some point in the lifecycle of your business, you’ll need access to financing—whether to cover cash flow, expand your team, cover an emergency, purchase equipment, or for a different purpose altogether. Small business loans can offer you the capital you need to run and grow your business.
Traditionally, business loans were only available from established banks, which, although offering the best rates and terms, also require lengthy processes and the highest qualifications—making it difficult for many small business applicants to get the funding they need. Today, however, between banks, government-guaranteed loans, and alternative, online lenders, there are now more options than ever for small businesses to get access to capital—including everything from term loans to lines of credit to asset-based financing.
You can use this guide to learn more about the best business loan products and top lenders offering them.
Traditionally, you could only get business loans from established banks. These loans offer the best rates and terms but also require lengthy processes and the highest qualifications—making it difficult for many small business applicants to get the funding they need. Today, however, between banks, government-guaranteed loans, and alternative, online lenders, there are now more options than ever for small businesses to get access to capital.
Ultimately, qualifications for a business loan largely depend on the lender you’re working with and the loan product you’re applying for. Generally, the better your personal credit, stronger your annual revenue, and longer your time in business, the more likely you are to qualify for a small business loan—and one with the most desirable rates and terms. However, even if your qualifications aren’t ideal, there may still be options for you.
Compare the top loan options and lenders to see what’s right for you.
SBA loans are government-guaranteed term loans that allow lenders to offer low-interest rates to business owners who might not qualify for a bank loan.
Best for: Low-rate, SBA loans.
SmartBiz is a preferred SBA lending partner, offering SBA 7(a) loans. SmartBiz can offer SBA loans with some of the best rates and terms available. These loans can be used for a variety of purposes and are well-suited for newer businesses, as well as established, highly qualified businesses that are looking for long-term financing.
Online term loans are lump sum loans designed to accommodate a wide variety of businesses and their funding needs. The repayment period and rates of an online term loan will depend on the lender—however, short-term loans can have a repayment period of a few months up to a year, and long-term loans from a year to five years.
Best for: Access to shorter-term financing with a pre-payment discount.
OnDeck is an online lender that provides fast, short-term financing in amounts up to $500,000. Short-term loans from OnDeck are great for covering big, unexpected expenses and can be used for virtually any purpose. OnDeck’s loan application can be completed quickly and easily online and they can fund businesses in as little as one day. Plus, unlike many alternative lenders, OnDeck offers a prepayment discount on your interest-owed if you pay back your loan early.
Best for: Fast, flexible revolving business lines of credit.
Idea Financial is an online lender that offers flexible revolving business lines of credit. With Idea Financial, you can access credit lines of up to $250,000 with repayment terms of up to 18 months. Idea has flexible payment options so you can repay on a weekly, bi-weekly, or monthly basis and only pay interest on the funds you draw. Additionally, with no origination fees, pre-payment penalties, and an online demand portal for withdrawing funds, Idea Financial makes it easy for you to draw from and afford your business line of credit.
Business lines of credit are one of the most flexible forms of financing—giving you the ability to draw from a set pool of funds when you need capital. Unlike a traditional term loan, you’ll only need to repay the capital you withdraw, plus interest.
Best for: Startups trying to establish business credit.
National Corporate Credit is an online lender that helps startups establish revolving business lines of credit in amounts up to $150,000. As a startup there is no revenue so to establish this business line of credit the personal credit must meet certain requirements. Contains a 0% interest rate introductory rate that ranges between 6-24 months, an amazing thing to have as a startup when the revenue still isn’t there.
Best for: Fast, flexible revolving business lines of credit.
Idea Financial is an online lender that offers flexible revolving business lines of credit. With Idea Financial, you can access credit lines of up to $250,000 with repayment terms of up to 18 months. Idea has flexible payment options so you can repay on a weekly, bi-weekly, or monthly basis and only pay interest on the funds you draw. Additionally, with no origination fees, pre-payment penalties, and an online demand portal for withdrawing funds, Idea Financial makes it easy for you to draw from and afford your business line of credit.
Invoice financing is a form of asset-based financing in which your unpaid invoices serve as collateral on the capital you borrow from a lender. Generally, invoice financing lenders can advance capital worth up to 85% of the value of your invoices with the 15% (minus fees) paid when your invoices are fulfilled.
Best for: Fast, accessible business lines of credit.
BlueVine is an online lender that offers lines of credit with a fast and fully digitized application and underwriting process. Lines of credit from BlueVine are worthwhile for business owners looking to fulfill a specific, short-term financing need—as well as for newer businesses. With their speed and flexible requirements, BlueVine lines of credit are also good for businesses who can’t qualify for a more traditional financing option.
Best for: Fast access to invoice factoring for businesses who need at least $15,000 per month in factoring
altLINE is an invoice factoring company and part of the commercial financing division of The Southern Bank. altLINE offers invoice factoring of up to $4 million per month (with a minimum $15,000 per month required) and up to 90% of an invoice’s amount. Businesses can apply for invoice factoring through altLINE quickly and easily online—and altLINE will look at your accounts receivables and credit quality of your customers to determine your eligibility. altLINE is a great option for businesses whose cash flow is consistently tied up in unpaid invoices, especially since as an invoice factoring company, they’ll handle the process of retrieving payments from your customers.
Equipment financing is a type of small business loan given for the specific purpose of purchasing new or used equipment. You can get an equipment loan equal to up to 100% of the value of the equipment you’re looking to purchase, which you’ll then pay back over time, with interest.
Best for: Fast access to both short and long-term equipment loans.
Everlasting Capital provides both a financing and leasing a option. Startups can get funding up to $50,000 and non startups can get up to $150,000. Everlasting has flexible qualification requirements. Equipment financing/leasing is a great option for businesses looking to purchase a piece of equipment.
Factoring is a financial transaction and a type of debtor finance in which a business sells its accounts receivable to a third party at a discount. A business will sometimes factor its receivable assets to meet its present and immediate cash needs.
Faster Cash Supply
Collections Assistance
Concierge Services
Interest Fees
Customer Reactions
Another System to Manage
Payment Default Risk
Best for:Fast access to invoice factoring for businesses who need at least $40,000 per month in factoring.
Paragon Financial is an invoice factoring company that offers invoice factoring of up to $5 million per month (with a minimum $40,000 per month required) and up to 90% of an invoice’s amount. Paragon will look at your accounts receivables and credit quality of your customers to determine your eligibility. Paragon Financial is a great option for businesses whose cash flow is consistently tied up in unpaid invoices, especially since as an invoice factoring company, they’ll handle the process of retrieving payments from your customers.
Best for: No personal credit requirement with fast access and great for trucking companies.
TAB bank is a factoring company that has provided factoring for over 20 years with no personal credit requirement. TAB has a whole factoring sector dedicated to helping trucking companies. That includes from leasing or buying new equipment, to opening a new location or hiring new employees etc. Must be a US company.
Real Estate Loans can take on different structures depending on the lender you work with and the amount of financing you need. Banks provide commercial Real Estate Loans with longer repayment terms and lower interest rates.
Best for: Real estate investors seeking leniency for approval
Velocity offers a no-doc loan. Meaning no income, asset, or tax verifications. Designed for investors seeking a simple financing solution for purchase or refinance, with the flexibility to remain in the loan for up to 30 years with no balloon payment. Also offers a product designed for investors with derogatory credit issues and high equity seeking quick and easy credit qualification. Rates range depending on credit, property type & type of transaction. A great program to expand or begin your real estate journey.
Best for: One stop shop for real estate investors
Founded for real estate investors, by real estate investors with an amazing business model. Offers a wide variety of fix and flip (FixNFlip) rehab loans, Multifamily & Rental loan options, as well as a variety of New Construction loans. Made for both beginner and experienced real estate investors. With no debt/to income underwriting, Lima will look at deal for what it is and the profit that can be made.
Best for: Commercial Real Estate
Specialists for Commercial Real Estate (CRE) lending. If you are planning to purchase any kind of income-producing property such as residential rental property, retail malls, shopping centers, office buildings, complexes or hotels – AMZA Capital can help you. Also offers flixnflip and buy-to-rent programs. Crafts a lending solution around almost any combination of credit, collateral or cash flow. Amza also offers incredible non-recourse solutions, meaning that the borrower is safe against any recovery efforts, leaving only the property on the line.
LENDER | BEST FOR | EST. INTEREST RATES | MIN. CREDIT SCORE |
---|---|---|---|
Cadence Bank | SBA loans | Variable based on the Prime Rate | 650 |
First Home Bank | SBA loans | Variable based on the Prime Rate | 650 |
OnDeck | Online term loans | 9.99% to 99% | 600 |
BlueVine | Lines of credit | 4.8% to 51% | 600 |
BlueVine | Invoice financing | 0.25% to 1.7% per week | 510 |
Balboa Capital | Equipment financing | 4% to 25% | 600 |
Getting the right business loan for you can be challenging—there are many different loan types available, and many lenders offering them. If you work directly with just one lender, how can you be sure you’re getting the best type of loan, interest rates, and terms for your unique financing needs?
That’s where a marketplace like Fundera comes in.
Fundera connects small business owners to the best loan option for them through our online marketplace of vetted business lenders. With one simple application, you can see all the products and lenders you qualify for, and start evaluating which small business loan is best for your business. Fundera features leaders in every financial category, so you can rest assured that you’re accessing the best products on the market.
* Loans only apply to non-owner occupied properties. Rates, terms and conditions offered only to qualified borrowers, may vary upon loan product, deal structure, property state or other applicable considerations, and are subject to change at any time without notice, shall only constitute a general, non-binding expression of interest on the part of Apex Capital USA Solutions Corp, do not create any legally binding commitment or obligation on the part of Apex Capital USA Solutions Corp, and are expressly subject to Apex Capital USA Solutions Corp credit, legal and investment approval process. Closing times are in business days and commence upon receipt of appraisal payment and satisfaction of borrower conditions. Closing times may be delayed due to appraiser property access limitations or availability in certain markets. Rates are as of 01/15/2019.