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Best Business Term Loans of 2026

Get the capital you need with regular repayments you can plan around with these term loans.

Megan B. Shepherd's headshot

By

Megan B. Shepherd

Edited by

Richard Laycock

Posted

Fact checked

Key takeaways

  • A business term loan gives you a lump sum upfront with fixed repayments — making it easier to budget than revolving credit when you’re making a planned investment.
  • APR is the most accurate way to compare loan costs — some lenders use factor rates instead, which can make true cost harder to spot.
  • Online lenders can fund in as little as 24 to 72 hours, while bank and SBA loans typically take weeks to months.
This summary was generated by AI and may contain errors or omissions.

Whether you’re buying equipment, expanding a location or simply need working capital with a predictable payment schedule, a business term loan gives you structure to plan around. Rates, amounts and approval requirements vary widely though, and the right lender really depends on your credit profile, how long you’ve been in business and how fast you need the money.

Top 10 business term loans

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Finder Score Loan amount Loan term APR

Best marketplace for multiple lender options

Lendio logo
Finder score
9.6 Excellent
Lendio business loans
Finder score
9.6 Excellent
$1,000 – $10,000,000
3 months to 25 years
Varies by lender
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Why we like it

Lendio is a loan marketplace, not a direct lender, that connects you with 75+ lending partners through a single application. For term loan shoppers, that means you can see competing offers across a range of amounts and terms from 6 months to 10 years without triggering multiple hard credit pulls. A dedicated funding manager helps you compare offers and choose the best fit for your repayment goals and business profile.

Pros

  • Single application surfaces term loan offers from 75+ lenders
  • Term loans fund as soon as 24 hours after approval
  • Wide term length range
  • Funding managers help you compare total cost, not just rate

Cons

  • Not a direct lender
  • Origination fees may apply depending on your matched lender
  • Less control over which lenders see your information

Best for fast marketplace matching

Lendzi logo
Finder score
9.5 Excellent
Lendzi
Finder score
9.5 Excellent
$5,000 – $20,000,000
6 months to 25 years
Varies by lender
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Why we like it

Lendzi connects borrowers with 60+ lending partners and runs a soft credit pull only for the initial quote — so you can see term loan options across multiple lenders without any score impact. For term loans specifically, their own site discloses interest rates of 6% to 30% and terms of 1 to 5 years, giving you a clearer cost baseline than most marketplaces publish before you apply. Funding can reach your account in as little as 48 hours after approval.

Pros

  • Soft credit check for initial quote
  • Connects to 60+ lenders across multiple loan types
  • Funding possible in as little as 48 hours after approval
  • Phone support available alongside the online application

Cons

  • Not a direct lender
  • APR not disclosed on Lendzi's site; varies by lender
  • Revenue and time-in-business minimums not published on their site

Best for same-day funding

Pinnacle Funding logo
Finder score
9.9 Excellent
Pinnacle Funding
Finder score
9.9 Excellent
$10,000 – $5,000,000
6 to 24 months
Varies by loan type
Go to site View details
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Why we like it

Pinnacle Funding is a direct lender focused on speed and accessibility. Term loans can be funded the same day, the application takes five minutes and Pinnacle says it focuses on your overall business performance rather than your credit score alone. No hard credit pull is required during the application process. If you need a fast decision and quick access to capital, especially if you've been turned down elsewhere or have a short business history, Pinnacle is worth considering.

Pros

  • Same-day funding available on approved applications
  • Five-minute application with no paperwork required
  • Minimum just 6 months in business required

Cons

  • Loan amounts, APR and term lengths are not listed on their website
  • Pricing structure not publicly disclosed — contact for a quote

Best for comparing lender partners

Businessloans.com Main Product logo
Finder score
8.8 Great
BusinessLoans.com
Finder score
8.8 Great
$10,000 – $3,000,000
Not listed
Not listed
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Why we like it

BusinessLoans.com is a loan marketplace that matches you with up to five funding partners through a single online application, with no hard credit pull during the process. Its network covers both short-term and long-term business loans, making it a useful starting point if you want to compare multiple term loan offers at once before committing to any single lender. Funding is possible in as little as 24 hours once you're matched and approved.

Pros

  • Matched with up to five lenders through one application
  • No hard credit pull during the matching process
  • Range of loan types available through the lender network
  • Funding possible in as little as 24 hours with a matched lender

Cons

  • Not a direct lender
  • Rates and fees not disclosed on BusinessLoans.com's own site
  • Requires sharing contact details before viewing matched lenders

Best for flexible credit requirements

Advance Funds Network logo
Finder score
9.6 Excellent
Advance Funds Network
Finder score
9.6 Excellent
$10,000 – $5,000,000
6–18 months
Varies by lender
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Why we like it

Advance Funds Network (AFN) has been funding small businesses since 2007 and accepts personal credit scores as low as 450, one of the lowest minimums you'll find among direct lenders. It's a direct lender offering fixed-rate business term loans with fast decisions, approvals often in minutes and same-day or next-business-day funding. AFN's term loans run 6 to 18 months with daily or weekly payments, shorter than a conventional bank term loan and better suited for businesses that need a defined, manageable repayment window.

Pros

  • Accepts credit scores as low as 450
  • Only three months in business required
  • Fixed interest rates — no variable rate surprises
  • Approvals in minutes; same-day or next-business-day funding

Cons

  • 6 to 18 month terms are shorter than traditional term loans
  • Daily or weekly repayment schedule can put pressure on cash flow
  • Full APR range not detailed; starts at 12% and varies by profile

Best for established businesses

Bank of America logo
Finder score
7.2 Great
Bank of America business loans
Finder score
7.2 Great
$10,000 – $5,000,000
Not listed
Fixed rates as low as 7.00%
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Why we like it

Bank of America's Business Advantage Term Loan is one of the few bank term loans where the starting rate is publicly disclosed on their own website, as low as 7.00% fixed. No collateral is required and the loan comes with fixed equal monthly payments for the life of the term. The qualification bar is higher than with most online lenders. You'll need a personal credit score above 700, at least two years in business under current ownership and a minimum of $100,000 in annual revenue to qualify.

Pros

  • Fixed rates as low as 7.00% — competitive for an unsecured term loan
  • No collateral required
  • Fixed equal monthly payments for the life of the loan
  • Bank of America's Preferred Rewards for Business program may offer interest rate discounts

Cons

  • Personal credit score above 700 typically required — stricter than most online lenders
  • Requires at least 2 years in business
  • Existing Bank of America customers have an easier online application path; others may need to apply in person
  • Loan maximum not published on their own site

Best online term loan

iBusiness Funding logo
Finder score
8.8 Great
iBusiness Funding
Finder score
8.8 Great
$25,000 – $500,000
6 months–5 years (term loans); 10–25 years (SBA 7(a))
Not listed
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Why we like it

iBusiness Funding, which acquired Funding Circle's US business in 2024, is an online lender offering term loans from $25,000 to $500,000 with terms up to five years and no application fee or prepayment penalty. That combination of meaningful loan size, multi-year terms and zero prepayment cost makes it a strong fit for businesses that want the structure of a true term loan without bank-level friction. Term loans fund in as little as two to four business days, and a single application also covers SBA 7(a) loans up to $5M if you qualify.

Pros

  • Funds in as little as 2–4 business days
  • One application for both term loans and SBA 7(a) loans up to $5M
  • No application fee and no prepayment penalty
  • Soft credit pull on initial application — no score impact to apply
  • Dedicated account manager for every borrower

Cons

  • Min. credit score of 640 — higher than some online competitors
  • Rates not published on their website — apply to see your rate
  • Blanket lien on business assets may be required depending on loan product and term length

Best for speed + newer businesses

OnDeck Capital logo
Finder score
9.2 Excellent
OnDeck short-term loans
Finder score
9.2 Excellent
$5,000 – $400,000
18–24 months
Not listed
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Why we like it

OnDeck is one of the most accessible online term loan options for businesses that need capital quickly and have less history than bank lenders require. Just one year in business, a credit score of 625 and $100,000 in annual revenue are enough to apply, and OnDeck can fund the same day an application is approved. Term lengths run 18 to 24 months maximum, so OnDeck is a better fit for shorter-term needs like covering an immediate expense or time-sensitive purchase rather than long-horizon capital investments.

Pros

  • Same-day funding available on approved applications
  • Just 1 year in business required
  • 625 minimum credit score — accessible for newer businesses
  • No hard credit pull on initial application

Cons

  • Max term of 24 months — not suited for longer-term investments
  • APR not published on their website; determined by business health and cash flow
  • General lien on business assets plus personal guarantee required

Best for lower credit scores

Fora Financial logo
Finder score
8.8 Great
Fora Financial business loans
Finder score
8.8 Great
$5,000 – $1,500,000
4 to 18 months
Undisclosed
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Why we like it

Fora Financial has been funding small businesses since 2008 and accepts personal credit scores as low as 570. It's a direct lender that funds in as little as 24 hours after offer acceptance and performs only a soft credit pull, your credit score isn't affected by applying. There's no prepayment penalty and early payoff discounts are available. One important distinction: Fora uses factor rates rather than APR for its small business loan product. Factor rates of 1.13 to 1.50 mean you repay between $1.13 and $1.50 for every dollar borrowed total, regardless of how quickly you repay. Always calculate the total repayment amount, not just the rate, when comparing Fora against APR-based lenders.

Pros

  • Accepts credit scores as low as 570
  • Only 6 months in business required
  • Soft credit pull only — no score impact to apply
  • Funding in as little as 24 hours after offer acceptance
  • No prepayment penalty; early payoff discounts available

Cons

  • Uses factor rates instead of APR — harder to compare against other lenders
  • Terms max at 24 months
  • Factor rates of 1.13 to 1.50 can convert to high effective APRs, especially on shorter terms

Best for early payoff discount

National Funding logo
Finder score
9.6 Excellent
National Funding business loans
Finder score
9.6 Excellent
$5,000 – $500,000
4 to 24 months (working capital); 2 to 5 years (equipment)
Not listed
View details
Compare product selection

Why we like it

National Funding has been working with small businesses since 1999 and offers one feature you won't commonly find elsewhere: a 7% discount on the remaining balance if you pay off your loan within 100 days of signing. For businesses that expect to repay quickly, that's meaningful cost savings. Loans fund in as little as 24 hours, no collateral is required and the application is straightforward. National Funding uses factor rates rather than APR, so compare total repayment amounts, not just the rate, when shopping.

Pros

  • 7% early payoff discount when repaid within 100 days of signing
  • No collateral required
  • Funding in as little as 24 hours after approval
  • Soft credit check during prequalification

Cons

  • Uses factor rates, not APR — makes direct cost comparison harder
  • 12 to 18 month terms are shorter than conventional term loans
  • Rates not published on their website — contact for a quote
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Methodology: How we chose these lenders

We verified every product detail directly against each lender’s own website. Each lender was evaluated across:

  • Loan amounts and terms — what funding range is available and how long you have to repay
  • Rate transparency — whether APR, factor rates or interest rate ranges are disclosed on the lender’s own site
  • Eligibility requirements — minimum credit score, time in business and annual revenue per each lender’s own disclosures
  • Funding speed — time from approval to money in your account
  • Lender type — direct lender vs. marketplace and how that affects the borrower experience
  • Use case fit — whether the product genuinely earns its category on this page

What is a business term loan and how does it work?

A business term loan is a lump sum of money you receive upfront and repay, with interest, over a fixed period through regular installments. The “term” is simply how long you have to pay it back, ranging from a few months to 25 years depending on the lender and what you’re using the money for.

Before you sign, you and the lender agree on the loan amount, interest rate or factor rate and repayment schedule. Once funded, payments begin on a predictable fixed schedule, which is why business owners often prefer term loans over revolving credit when making a specific, planned investment.

The most accurate way to compare loan costs across lenders is APR, which captures both the interest rate and any fees. Two loans with the same interest rate can have very different APRs if one charges an origination fee. Some lenders instead use factor rates, a flat multiplier applied to the total loan amount. If a lender uses factor rates, calculate the total repayment amount to compare fairly against APR-based lenders.

Pros and cons of business term loans

Pros

  • Predictable fixed payments make budgeting straightforward
  • Typically lower rates than credit cards or merchant cash advances
  • Flexible use, from payroll to equipment to real estate
  • On-time payments can build your business credit profile

Cons

  • Repayments begin right away, even if your project hasn't yet generated revenue
  • Less flexible than a line of credit — you can't redraw funds as you repay
  • Stricter eligibility than some short-term financing options
  • Collateral or personal guarantees often required on larger amounts

How much do business term loans cost?

The cost of a business term loan depends on three things: the interest rate or factor rate, the fees and the loan term. Here’s how each one works.

Interest rate vs. APR. The interest rate is the base cost of borrowing. APR includes the interest rate plus fees — origination, closing, and any other charges — expressed as a single annual figure. APR is the most accurate way to compare loans. Always use APR, not just the stated interest rate, when shopping.

Factor rates. Some lenders, particularly short-term online lenders, use factor rates instead of APR. A factor rate is a flat multiplier applied to the loan amount. A 1.30 factor rate on a $50,000 loan means you repay $65,000 total, regardless of how fast you pay it off. Factor rates don’t account for time, so they’re harder to compare against APR-based loans. To get a rough APR equivalent, calculate the total repayment cost and annualize it over the loan term.

What you can expect to pay by lender type

Lender typeTypical APR range
Bank term loan6.8%–11%
SBA 7(a) loan9.75%–13.25% (maximum variable rates, based on prime of 6.75%)
Online term loan14%–99%
Short-term / factor rate lendersFactor rates of 1.10–1.50; equivalent APR often 10%–99%+

Common fees to watch for

  • Origination fee — typically 1%–5% of the loan amount, deducted upfront or added to the balance
  • Prepayment penalty — charged by some lenders if you repay early; others offer prepayment discounts
  • Late payment fee — a fixed amount or percentage charged on missed payments
  • Closing costs — more common on larger bank or SBA loans

How to compare business term loans

Before applying anywhere, here’s what to evaluate:

  • APR vs. factor rate. APR is the standardized way to compare loan costs. Some lenders, particularly those offering shorter-term products, use factor rates instead.
  • Fixed vs. variable rate. Fixed rates stay the same for the life of the loan, predictable and easy to budget for. Variable rates can move with market benchmarks like the prime rate.
  • Term length. Make sure the repayment window is long enough to keep payments manageable without extending the loan longer than you need.
  • Fees. Origination fees of 1% to 5% are common. Some lenders charge prepayment penalties, others offer prepayment discounts. Factor fees into total cost comparisons.
  • Time to funding. Bank and SBA loans take weeks to months. Many online lenders fund in 24 to 72 hours. Match the timeline to your actual need.
  • Eligibility. Check minimum credit score, time in business and annual revenue before applying to avoid unnecessary hard credit inquiries.

Types of business term loans

TypeTypical loan amountsTypical termsBest for
Conventional bank term loan$10,000–$1M+1–7 yearsEstablished businesses with strong credit
SBA 7(a) loanUp to $5MUp to 25 yearsBusinesses that don’t qualify for conventional bank rates
SBA 504 loan$125,000–$20M10 or 20 yearsMajor fixed assets, real estate or large equipment
Online term loan$5,000–$500,0006 months–5 yearsFaster funding, businesses with less established credit
Equipment financing$5,000–$5M+1–10 yearsPurchasing specific business equipment
Short-term business loan$2,500–$500,0003–24 monthsUrgent cash flow needs, lower qualification threshold

How to qualify for a business term loan

Requirements vary by lender type but most evaluate the same core factors:

  • Personal credit score. Bank lenders typically want 680 or higher. Many online lenders accept 450 to 640. Higher scores generally mean better rates.
  • Time in business. Banks usually require two plus years. Online lenders may accept as little as three to six months.
  • Annual revenue. Ranges from around $180,000 at some online lenders to $250,000+ for bank products.
  • Business credit history. Separate from your personal score, lenders may review business credit through Dun & Bradstreet or Experian Business.
  • Collateral. Larger loans often require business assets or real estate as security. Many online lenders offer unsecured options.
  • Cash flow. Lenders want to see enough revenue to cover existing obligations plus the new loan payment.

How to apply for a business term loan

  1. Check your credit. Pull both personal and business credit reports before applying. Errors can lower your score and cost you a better rate.
  2. Determine how much you need. Be specific — over-borrowing increases cost and under-borrowing may mean a second loan later.
  3. Compare lenders. Use your credit score, time in business and how quickly you need funds to narrow the right lender type.
  4. Gather your documents. Most lenders want three to six months of bank statements, two years of tax returns, a profit and loss statement and legal business documents.
  5. Prequalify where possible. Many online lenders offer a soft credit pull so you can see estimated terms without affecting your score.
  6. Submit your formal application. Response times range from minutes (online lenders) to several weeks (SBA and bank loans).
  7. Review the agreement carefully. Before signing, confirm the full APR or factor rate, total repayment amount, origination fees, prepayment terms and any collateral or personal guarantee requirements.

Compare business term loans

Find the right lender for your credit profile, funding timeline and loan amount.

Compare term loans

Alternatives to a business term loan

  • Business line of credit. Revolving access to funds up to a set limit — you only pay interest on what you use. Better for ongoing or unpredictable cash needs than a one-time investment.
  • SBA microloan. Up to $50,000 with terms up to seven years, designed for underserved borrowers and smaller funding needs.
  • Business credit card. Useful for everyday purchases. Introductory 0% APR periods can help short-term, though ongoing rates are typically high.
  • Invoice factoring. Sell outstanding invoices to a factoring company for immediate cash — no loan required. Works well for B2B businesses with slow-paying clients.
  • Equipment financing. If you’re specifically buying equipment, the asset serves as collateral — often easier to qualify for and more favorable rates than an unsecured term loan.
  • Revenue-based financing. Repay a percentage of daily or weekly revenue rather than a fixed payment. Revenue-based financing is useful for businesses with variable cash flow, though total cost can be high.

Frequently asked questions

Richard Laycock's headshot
To make sure you get accurate and helpful information, this guide has been edited by Richard Laycock as part of our fact-checking process.
Megan B. Shepherd's headshot
Editor, Loans & Insurance

Megan B. Shepherd is a personal finance expert and editor for loans and insurance at Finder. Her personal finance expertise has been featured on Forbes, Nasdaq, MediaFeed, Fox News, Time, Reviews.com, and carinsurance.com, adding invaluable information related to personal loans, financial strategies and smart borrowing tactics. Megan graduated from the University of Texas at Dallas with a BS in Business Administration with an entrepreneurial focus. She's worked as a certified financial adviser and has earned certificates of completion from A.D. Banker & Company. See full bio

Megan B.'s expertise
Megan B. has written 52 Finder guides across topics including:
  • Personal loans, business loans and home loans
  • Underwriting guidelines
  • Life, disability, car, health, accident, critical illness, dental and vision insurance
  • Policy comparison
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