Best Small Business Loans Of April 2024 (2024)

Best Business Loans Of April 2024

• OnDeck – Best for Short-term Loans
• QuickBridge – Best for Fast Funding
• American Express® Business Line of Credit – Best for Lines of Credit
• Bluevine – Best for Flexible Lines of Credit
• National Funding – Best for Small to Mid-Sized Business
• Fundbox – Best for Quick Approvals
• TD Bank – Best for Healthcare Professionals
• Funding Circle – Best for Established Business
• Biz2Credit – Best for Funding Options

Summary: Best Small Business Loans Of April 2024

Company	Company - Logo	Forbes Advisor Rating	Forbes Advisor Rating	Best For	Loan amounts	APR	Minimum credit score	Learn More CTA text	Learn more CTA below text	Learn More
OnDeck		4.5		Best for Short-term Loans	$5,000 to $250,000	Not disclosed	625	Learn More	Via Ondeck's Website
QuickBridge		4.5		Best for Fast Funding	$10,000 to $500,000	Factor rates start at 1.11	600	Learn More	On Quickbridge's Website
American Express® Business Line of Credit		4.0		Best for Lines of Credit	$2,000 to $250,000	N/A	660 FICO at the time of application	Learn More	Via American Express's Website
Bluevine		4.0		Best for Flexible Lines of Credit	$5,000 to $250,000	Not disclosed	625	Learn More	On BlueVine's Website
National Funding		4.0		Best for Small to Mid-Sized Business	$10,000 to $500,000	Buy rates start at 1.11%	600	Learn More	On National Funding's Website
Fundbox		4.0		Best for Quick Approvals	$1,000 to $150,000	Start at 4.66%	600	View More	On Fundbox's Website
TD Bank		4.0		Best for Healthcare Professionals	$10,000 to $1 million	Not disclosed	660	Learn More	From participating partners via businessloans.com's website.
Funding Circle		4.0		Best for Established Business	$25,000 to $500,000	As low as 7.49%	660	Learn More	From participating partners via businessloans.com's website.
Biz2Credit		4.0		Best for Funding Options	Up to $1M+	Does not disclose	575*	Learn More	On Biz2credit's Website *See Website For Details

Tips for Comparing Small Business Loans

Consider these tips when comparing small business loans:

Complete Guide to Small Business Loans

• What Is a Small Business Loan?
• How Do Small Business Loans Work?
• Common Types of Small Business Loans
• Pros and Cons of Small Business Loans
• Best Place To Get a Business Loan
• How to Get a Small Business Loan
• Alternatives to Small Business Loans
• Business Loan Statistics (Survey)

What Is a Small Business Loan?

A small business loan is a source of funding business owners can access to cover the costs associated with operation and growth. Like personal loans, business owners can get small business loans through traditional banks and credit unions as well as online lenders—including those backed by the U.S. Small Business Administration (SBA). Depending on the type of loan, you can use funds for everything from working capital and equipment acquisition to larger purchases like real estate.

How Do Small Business Loans Work?

Small business loans help companies make large purchases and cover the cost of doing business. Loans generally are issued as a lump sum that can be used to make a specific purchase or manage cash flow and then repaid with interest. However, there are other types of small business loans—like lines of credit, merchant cash advances and invoice financing—that can be used to access cash more quickly and on an as-needed basis.

The best loan for a business depends on a number of factors, including its creditworthiness, how much it needs to borrow, what the funds will be used for and how quickly it needs access to loan proceeds.

Read More: How Do Business Loans Work?

Common Types of Small Business Loans

In general, small business loans help businesses access the money they need to operate and grow. However, there are several types of small business loans, and it’s important to find the best fit for your needs.

Pros and Cons of Small Business Loans

Pros of Small Business Loans

• Provides funds you can use to start, grow or expand your business
• Receive funding without losing equity
• Repayment terms extend up to 25 years
• Loan amounts up to $5 million

Cons of Small Business Loans

• Most lenders require a personal guarantee or collateral
• Lenders typically require a minimum credit score of 670
• Approval and funding may take up to several weeks
• May charge high interest rates and other processing fees

Best Place To Get a Business Loan

Small business loans are available from a variety of traditional banks and credit unions as well as online lenders. However, each lender is limited by its own financial products and lending requirements.

Related: Best Same-Day Business Loans

How To Get a Business Loan

How To Choose a Small Business Loan

Just as certain types of loans are more appropriate for certain businesses, some lenders may be better suited to your business than others. Consider these factors to choose a small business loan:

• Lender reputation. Check online reviews so you’re aware of any red flags or potential issues before you sign on the dotted line. If you plan to work with a local bank or credit union, check with other local business owners to see which institutions have the best reputation.
• Qualification requirements. Most small business loans are underwritten based on the business owner’s personal credit score and are personally guaranteed. The minimum credit score required to qualify for a small business loan depends on the lender and the type of loan. So, it’s generally a good idea to check your personal credit score and then research each lender to compare minimum credit score requirements.
• Available loan amounts. Loan amounts vary by lender and loan type. Before choosing a small business lender, evaluate your business’ borrowing needs and shop for a loan that fits those parameters.
• Underwriting and funding speed. The amount of time it takes to process an application and receive funds varies widely by lender and loan type. In general, it can take anywhere from a couple of days (in the case of a merchant cash advance) to several months (for an SBA loan) to receive funds after submitting an application. If you need a loan quickly, choose a loan type and lender that can meet those time constraints.
• Annual percentage rate. APRs also vary by loan type and lender, but generally range anywhere from 5% to 99%. The most creditworthy applicants qualify for the lowest rates, but some lenders are more competitive than others.
• Additional costs. Many lenders charge origination fees that cover the costs of processing applications and underwriting loans. Likewise, some lenders charge prepayment penalties for borrowers who opt to pay off their loans early, while others charge draw fees on lines of credit. However, borrowers should not be charged application fees, and any fees levied prior to loan approval are a red flag.

How To Qualify for a Business Loan

The requirements for small business loans can vary by lender. But in general, lenders may review the following information to approve you for a loan:

• Personal credit. You may be able to qualify for a business loan with a credit score as low as 500. However, a good score of at least 670 could give you a better shot at getting approved for a competitive rate.
• Time in business. Lenders typically require that you be in business for at least six months to two years to qualify for a loan.
• Business checking accounts. Lenders may require that you have a business checking account with several months of transactions to show cash flow.
• Business revenue. Most lenders require that you have between $100,000 to $250,000 annual business revenue to qualify.

How To Get a Small Business Loan in 5 Steps

The business loan application and underwriting process varies by lender, but most banks and lenders follow the same general guidelines. To get a small business loan, expect to follow these general steps:

1. Determine the type of loan you need. Some lenders limit what industries they’ll finance or how loan funds may be used, so determine how you’ll use the cash before applying for a loan. Also evaluate how much you need to borrow, as this may impact the type of loan you apply for and the best lenders to approach for funds.
2. Familiarize yourself with your credit profile. Lenders typically look at a business owner’s personal credit score when evaluating a loan application. You should have a score of at least 680 to qualify for an SBA loan or a traditional bank loan, and 630 for equipment financing or business lines of credit. Short-term financing and merchant cash advances typically have less stringent requirements—averaging around 600 and 550, respectively.
3. Research lenders. When shopping for a small business loan, determine whether your current bank offers small business loans that meet your needs. This can streamline the application process because the bank will already have your financial information on file. Next, research other banks, credit unions and online lenders to compare available loan amounts, repayment terms and rates.
4. Gather required documentation. Required documentation varies by lender. However, most lending institutions require a business plan, at least 12 months of personal and business bank statements, tax returns for at least two years and details about any current and past business loans. Lenders also require copies of applicable business licenses and legal documents, details about available collateral and a description of how loan proceeds will be used.
5. Submit a formal loan application. Once you research the best small business loans and prepare your business for due diligence, submit a formal loan application. The process varies by lender, so familiarize yourself with the application process and contact customer service with questions.

How To Get a Business Loan With Bad Credit

It can be tough to qualify for a business loan with bad or limited credit. If possible, giving your business time to become more established can make qualifying for a loan easier.

If you can’t wait, start by looking for online lenders as they can have more flexible qualification requirements. Nonprofits that focus on microloans can also be an option to fund a new business venture.

Lastly, business partners that are willing to invest in your business or co-sign on a loan can be another option to fund your business.

Alternatives to Small Business Loans

If a small business loan doesn’t seem right for your specific needs, consider other options to get the financing your business needs.

Business Loan Statistics Survey

Forbes Advisor surveyed 500 Americans who have applied for a business loan to get insights into which loans businesses are applying for and how the funds are being used. The survey found that business owners seek out a wide range of business loans, with term loans and lines of credit being the most popular options.

Types of Financing Businesses Are Applying For

Businesses have a wide range of financing options, each of which can best serve different financial needs. Over the past five years, 49% of businesses that applied for financing applied for an SBA loan and 48% applied for a business line of credit.

Traditional business loans, including those from online lenders and banks, were the third and fourth most popular options, with 40% and 30% of businesses applying for them, respectively.

How Business Loan Funds Are Used

In most cases, business financing doesn’t restrict how funding can be used if it’s business-related. With their most recent loan, 32% of businesses used the funds on equipment purchases, while 26% allocated their funds toward startup costs.

Survey Methodology

This online survey of 500 Americans who have applied for a business loan in the past was commissioned by Forbes Advisor and conducted by market research company OnePoll, in accordance with the Market Research Society’s code of conduct. Data was collected from January 12 to 19, 2024. The margin of error is +/- 4.4 points with 95% confidence. This survey was overseen by the OnePoll research team, which is a member of the MRS and has corporate membership with the American Association for Public Opinion Research (AAPOR). For a complete survey methodology, including geographic and demographic sample sizes, contact pr@forberadvisor.com.

Methodology

We reviewed 25 popular lenders based on 16 data points in the categories of loan details, loan costs, eligibility and accessibility, customer experience and the application process. We chose the nine best lenders based on the weighting assigned to each category:

• Loan cost: 35%
• Loan details: 25%
• Customer experience: 20%
• Eligibility and accessibility: 10%
• Application process: 10%

Within each major category, we also considered several characteristics, including available loan amounts, repayment terms and applicable fees. We also looked at minimum credit score and time in business requirements and the geographic availability of the lender. Finally, we evaluated each provider’s customer support tools, borrower perks and features that simplify the borrowing process—like online applications, prequalification options and mobile apps.

Where appropriate, we awarded partial points depending on how well a lender met each criterion.

To learn more about how Forbes Advisor rates lenders, and our editorial process, check out our .