Buying an existing business often requires more upfront capital than starting one from scratch. Business acquisition loans can help cover the purchase price and related costs, but the right choice depends on factors like your credit, experience and how quickly you need funding. Here’s a closer look at some of the top lenders to help you find the best fit.
We evaluate lenders based on the following factors:
We also search for lenders that cater to a range of needs, including those that work with bad credit and newer business owners.
To narrow down your options and find the best fit, it helps to compare business acquisition loans using the following criteria:
Business acquisition loans are used to purchase or buy into an existing business. Most buyers use term loans or SBA loans, which are repaid in fixed monthly installments over a set period. Shorter term options, like lines of credit, can also be used in some cases, but they tend to be more expensive and are usually better suited for smaller purchases or working capital needs.
Repayment terms for business term loans typically range from three to 10 years, while SBA loans can extend up to 25 years. Depending on the lender and loan type, loans may be secured or unsecured, with SBA and commercial real estate loans often requiring a down payment of around 10% to 20%.
To qualify, lenders usually look for good credit along with at least two years in business and steady revenue. Many business acquisition loans also require a personal guarantee from the borrower.
Business acquisition loans can make it possible to buy an existing business, but they often come with stricter requirements than other types of financing. Here’s a quick look at the pros and cons of loans to buy a business:
Want to see how the business acquisition loans on our list compare to other lenders? Then check out the table provided below.
The Finder Score crunches 12+ types of business loans across 35+ lenders. It takes into account the product's interest rate, fees and features, as well as the type of loan eg investor, variable, fixed rate - this gives you a simple score out of 10.
To provide a Score, we compare like-for-like loans. So if you're comparing the best business loans for startups loans, you can see how each business loan stacks up against other business loans with the same borrower type, rate type and repayment type.
These are the most common types of loans used to purchase a new or existing business.
| Type | Typical loan amounts | Typical term lengths | Best for |
|---|---|---|---|
| Term loan | $5,000 to $2 million | 3 to 10 years | Long-term growth and expansion |
| SBA | Up to $5 million | 10 to 25 years | Long-term growth and expansion |
| Equipment financing | Up to $5 million | 1 to 5 years | Buying equipment and machinery |
| Commercial real estate (CRE) loan | Up to $5 million | 5 to 20 years | For purchasing or developing new property |
| Line of credit | $1,000 to $500K | 1 to 2 years | Working capital needs |
To qualify for a business acquisition loan, you’ll need to meet the lender’s credit score, time in business and annual revenue requirements. Also, be prepared to provide the following documents when applying for a business acquisition loan:
Applying for a long-term business loan typically follows these four steps:
Prequalification involves answering a series of questions about yourself and your business to determine your eligibility before you formally apply for a loan.
Here are the general steps:
Once you’ve narrowed down your options based on your quotes, you can formally apply for a loan with the lender of your choice. Just keep in mind that not all lenders offer a prequalification option; you may have to complete the full application to find out if you qualify.
Business acquisition loans are available from traditional lenders like banks and credit unions, online lenders and business loan marketplaces like Lendio, Lendzi and Biz2Credit. Here’s a look at the top options:
Banks and credit unions are a good place to start a search for a business acquisition loan. These institutions tend to have the most competitive rates, especially if you’re an existing customer. To qualify, you’ll typically need a minimum credit score of around 700, two years in business and at least $100,000 in annual revenue.
Online lenders tend to have more relaxed eligibility requirements than banks and credit unions and may offer faster processing times on term and SBA loans. Many online lenders also offer the SBA Express loan program, which typically offers faster turnaround times and funding than the SBA 7(a) and 504 loan programs.
Besides bank and online loans, there are other options for funding a new business acquisition. These include personal loans, home equity loans, venture capital and angel investor financing, crowdfunding or asking family and friends.
If you don’t qualify for a business acquisition loan because you don’t meet the lender’s revenue or time in business requirements or you’re a startup, consider these alternatives:
Explore the top business loan guides to help you along your business journey. From information on the best business loans on the market or your best startup loan options, to business loans that require little to no paperwork and more.
Compare the best business term loan providers for flexible funding, competitive rates and repayment terms that fit your goals.
Getting a business loan can be hard when banks and other traditional lenders have strict requirements. See what startup loan options are available.
Compare $50,000 no-doc business loans for an expedited lending process.
Compare $5,000 business loans and what you need to qualify.
Compare lenders to secure a $60,000 business loan with favorable terms.
There’s no fixed cutoff for your credit score to get a business loan, but your score could limit what types of financing you qualify for.
Find a $40,000 business loan for your business and calculate the cost before you apply.
Compare lenders that offer $30,000 business loans and calculate how much you can expect to pay each month before you apply.
Where to find funding to buy equipment, grow your business and more.
Compare top business loan marketplaces similar to Lendio to find the one that could work for your business.
Right now I have assets and I want to grow my business so I am kindly asking you if you can offer me a loan.
Hi Felix,
Thanks for getting in touch!
It’s good to know that you have assets and you’re wanting to grow your business! To know if you can be approved a loan. review the eligibility criteria of the loan before applying to increase your chances of approval. Read up on the terms and conditions and product disclosure statement and contact the bank should you need any clarifications about the policy.
Hope this was helpful. Don’t hesitate to message us back if you have more questions.
Best,
Nikki