If you’re looking for a faster way to secure business funding compared to traditional loans, no-doc and low-doc business loans might be the solution. These loans skip much of the usual documentation, allowing you to apply and get approved quickly — sometimes within a day.
Whether you need $50,000 to cover cash flow shortages or jump on a new business opportunity, this guide helps you navigate your options and choose the right no-doc or low-doc loan for your needs.
Check out these no-doc and low-doc lenders. They offer various types of financing for your business — including 50K loans — without the hassle of extensive paperwork.
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While you can get a $50k business loan at banks and credit unions, your best shot at a no- or low-doc business loan is with an online lender. Online lenders typically have a streamlined application and lending process that utilizes algorithms and other technologies to link directly to your accounts. These processes eliminate the more common practice of submitting piles of paperwork.
“No-doc business loans are frequently advertised online, on the radio and on television,” says Ben Johnston, COO at Kapitus. “A simple Google search will reveal many types of no-doc lenders, as well as aggregation sites that compare different lenders.”
“Before choosing a no-doc lender,” Johnston continues, “read the company’s reviews and search for information about that company online. See if they are mentioned in the press and if they disclose their management team and company history. Generally speaking, the longer a company has been in business and the more positive information available, the more sustainable and reputable they are.”
A no-doc (aka no-document) business loan refers to loans that require little to no submission of paper documentation to qualify for a business loan. No-doc lenders may only need to view your bank statements or link to your online accounts to grant loan approval. You’ll still need to fill out an application, usually online, and sign a contract.
No-doc loans are more common for short-term financing needs and typically have fast turnaround times. But, you could have higher interest rates than with other types of funding, and you may have to agree to a daily or weekly repayment schedule.
No-doc business loans may be your best option if you don’t qualify for other types of business financing, since no-doc lenders generally have less strict eligibility requirements. These types are also a good option for companies that simply need a fast short-term influx of funding to cover cash flow shortages or to fund other projects.
Lender application processes vary, but the process is generally as follows:
Requirements to qualify for a $50K no-doc business loan may depend on the lender and loan purpose, but here are some basic criteria you typically need to meet:
The cost of a $50,000 no-doc business loan can vary widely depending on the lender and the loan type. For example, many lenders charge interest rates or factor rates that range from 3% to 60% or more.
It’s important for borrowers to be aware that no-doc loans are usually more expensive for a reason, says Johnston. “Because these loans are issued with relatively little due diligence and often without collateral, the loss rates on no-doc business loans tend to be higher than full-doc loans. As a result, their cost is also higher.”
Other lenders, such as invoice financing or factoring companies, may charge a factor rate instead of an interest rate. A factor rate is basically a percentage of the loan you’ll need to pay on top of the principal. For example, a factor rate of 1.2 for a $50,000 loan means you would owe a total of $60,000 ($50,000 x 1.2).
No-doc loans may also come with origination or other fees. Ask your lender and read the fine print to understand what additional charges may be applied to your loan.
Many no- or low-doc business loans have shorter loan terms, which make them more expensive to budget. In addition, short-term financing may require a weekly or daily repayment schedule, which may not be feasible for some businesses.
Use our business loan calculator to compare monthly loan payments based on different interest rates and loan terms.
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If you’re looking for a no- or low-doc business loan, consider these five loan types to see which meets your business needs.
MCAs might be a good solution for companies that bring in a lot of revenue from debit and credit card sales. Merchant cash advance providers lend you a lump sum in exchange for a percentage of future credit card sales. This type of financing is usually very expensive and typically requires a weekly or daily repayment plan.
Consider if you…
A business line of credit could be a good choice if you’re not sure how much you need and want some borrowing flexibility. Lines of credit can be drawn from as needed for typically one to two years, and you only pay interest on what you borrow. You’ll typically need a good credit score, but you may only have to provide recent bank statements to qualify.
Consider if you…
Invoice factoring requires little to no documentation because it’s almost entirely dependent on the value of your invoices. It’s a type of lending where you sell your unpaid invoices to a factoring company that advances funding based on a percentage of your unpaid invoices. The factoring firm then collects on the invoices until the loan is repaid, including interest and fees, which can be steep.
Consider if you…
Invoice financing is similar to invoice factoring in that you borrow money based on the value of your unpaid invoices. The difference is that you maintain control of your invoices and repay the loan as customers pay their bills. Because of the high rates and fees, both invoice financing and factoring should only be considered for very short-term financing.
Consider if you…
When you take out an equipment loan, which is similar to a consumer auto loan, the asset you purchase is used as collateral for the loan. Because it’s a secured loan, it may have more competitive interest rates than other types of business financing, but there is a risk of losing the asset if you default on the loan.
Lenders could require a downpayment on an equipment loan and will need proof of sufficient revenue to repay it, but lenders may require very little additional documentation. Loan terms for equipment financing are typically longer than other low-doc loans, which can be easier to budget.
Consider if you…
If you have cash flow shortages or want to jump on a business opportunity, no-doc or low-doc loans can provide a speedier way to access needed funding. No-doc lenders use technologies to eliminate the need for a lot of paperwork, allowing borrowers to qualify in minutes and receive funding within a day or two. Just be sure to do your research and compare multiple business lenders to get the best deal.
Yes. Lenders that offer no-doc business loans offer financing anywhere from thousands to millions of dollars. Of course, qualifying for higher-dollar loan amounts depends on your revenues, credit scores and other factors.
Maybe. Usually, no-doc business loans rely on business revenues and business credit scores as well as personal credit history to determine loan approval. However, if you have excellent personal credit, a low debt-to-income ratio (DTI) and sufficient income, you may qualify for a $50K loan to start a business.
Maybe. If you meet other lender requirements, such as strong financials and other criteria, you may be able to get a $50,000 no-doc loan even with bad credit. In fact, many lenders, such as BusinessLoans.com and Credibly, will consider borrowers with scores as low as 500 for some loan types.
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