What Is a Business Loan?
A business loan is any type of financing created specifically for business purposes. There are many variations of business loans, including term loans, SBA loans and accounts receivable financing. Each program has its own qualifying requirements, terms and rates.
Explore Your Small Business Loan Options
Find the best rates on the type of loan that's right for you, and how to qualify.
Business Term Loan
Traditional term loans disperse a lump sum payment that is repaid over the course of several years (the "term" of the loan).
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Loan Amount
$10,000—$2,000,000
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Estimated Repayment Term
1—5 years
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Interest Rate
Starting at 7%
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Speed of Funding
As fast as 1 day
Short-Term Loan
This type of commercial business loan usually ranges from 3 to 18 months and is repaid in daily or weekly increments.
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Loan Amount
$3,000-$500,000
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Estimated Repayment Term
3-18 months
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Interest Rate
Starting at 10%
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Speed of Funding
As fast as same day
SBA Loans
SBA Loans are partially guaranteed by the Small Business Administration, which helps lenders provide more favorable terms to borrowers.
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Loan Amount
$5,000—$5,000,000
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Estimated Repayment Term
5—25 years
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Interest Rate
Starting at 6%
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Speed of Funding
As fast as 30 days
Working Capital Loans
Business financing acquired for the purpose of working capital. Can be used to invest or support in the operations of the business.
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Loan Amount
$3,000—$5,000,000
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Loan Term
3 months—25 years
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Interest Rate
Starting at 7%
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Speed of Funding
As fast as same day
Equipment Financing
Useful when your business loses one or several expensive machines that are a pivotal part of the way your business functions.
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Financing Amount
Up to 100% of value
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Estimated Repayment Term
1—5 years
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Interest Rate
Starting at 8%
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Speed of Funding
As fast as 2 days
Business Line of Credit
Available through both banks and online lenders, a line of business credit provides companies with a more flexible funding option that can be both short and long-term.
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Loan Amount
$5,000—$500,000
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Estimated Repayment Term
6 months—3 years
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Interest Rate
Starting at 8%
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Speed of Funding
As fast as 1 day
Merchant Cash Advance
A merchant cash advance (MCA) is a lump sum of capital lent against a business’s future sales.
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Advance Amount
$3,000—$500,000
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Estimated Repayment Term
3—18 months
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Factor Rate
Starting at 1.14
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Speed of Funding
As fast as same day
Commercial Loans
This type of commercial business loan usually ranges from 3 to 18 months and is repaid in daily or weekly increments.
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Loan Amount
$3,000—$5,000,000
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Loan Term
3 months—25 years
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Interest Rate
Starting at 7%
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Speed of Funding
As fast as same day
Invoice Financing
Turn unpaid invoices into capital. Get back to running your business by bridging the gap and shortening your accounts receivable terms.
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Advance Amount
Up to 80% of receivables
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Estimated Repayment Term
Until receivables are paid by the customer
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Factor Rate
Starting at 1.02
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Speed of Funding
As fast as same day
What Are the Benefits of a Small Business Loan?
When your business needs additional capital, securing a small business loan can be the best decision you make for your company.
Avoid Cash Flow Disruptions
Each business, no matter their size, experiences periods where working capital is tight. A small business loan can help shorten these stretches, without interrupting operations.
Keep Your Equity
Securing a small business loan allows you to maintain control of your company. You can use your loan however you like and can keep any profits or gains your business generates, all without seeking permission from your lender.
Long-Term Growth
In order to grow, you have to continually invest in your business. A small business loan can enable you to plan for the future without using any working capital from your day-to-day needs.
Expand
Trying to capitalize on a new market? With a small business loan, you can secure the location you need to widen your business’s reach. The more locations you have, the greater your chance to grow.
How Do I Apply for a Business Loan?
Deciding to apply for a small business loan is a big step for your business. Before submitting any applications, let’s review where and how you can apply.
Where to Apply for Small Business Loans
Banks
When applying through a bank, small businesses go through a multi-step process that can take as long as 6 months to complete. Business owners are asked to complete a physical application, meet with a loan officer, and are sometimes even required to present a full proposal for how they intend to use their funds and how it will benefit their business.
Online Lenders
Applying with an online lender involves a simple online application that can often be completed in minutes. Their applications often ask only for basic business and personal information and can even approve your company for a small business loan within hours.
Some other documents you may need are:
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Driver's License
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Business/Personal Tax Returns
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Bank Statements
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Voided Business Check
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Credit Score
The Best Business Loan Offer for You
When the time comes to finally choose the small business loan that’s right for you, it’s crucial to ask yourself and your partners these questions:
- Can I pay back this loan?
- Am I comfortable with this payment?
- Am I comfortable whether it’s daily, weekly or monthly?
- Is this the best rate I can find?
- Am I aware of all the fees associated with my loan?
If you’ve answered “yes” to these questions, then congratulations! You’re ready to accept your small business loan and start growing your company.