You have many choices when you need a $250k business loan. Almost all business lenders offer loans of this amount, but to qualify, you typically need a credit score of at least 670 and have a business that’s at least 12 months old. Find out where you can apply for a $250k business loan in Canada and how much the loan may cost you in monthly payments.
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Where to get a $250,000 business loan for a small business
You can get a $250,000 business loan from a bank, credit union, alternative lender or business loan broker.
Banks and credit unions
If your business is doing well, you can apply for a $250k business loan from a bank or credit union. Banks and credit unions have stricter eligibility requirements than alternative lenders, but they often have more competitive rates. To increase your chances of approval, you’ll need at least 12 to 24 months of positive revenue, industry experience, personal financial investments in your company, a good credit score and a detailed business plan.
Alternative lenders
If you don’t qualify for a business loan from a bank or credit union, you can apply to an alternative lender. Alternative lenders have higher rates on average, but they have more flexible requirements. They are also faster at funding business loans. While banks and credit can take weeks to give approval and funding, alternative lenders usually take 1 to 2 business days. However, for large amounts like a $250k business loan, the process can take longer.
Business loan brokers
A business loan broker like Swoop will take your business loan application to different lenders and come back to you with potential loan offers. If you’re new to business lending or your business is not established with well-documented revenue, a broker can help you find the right financing.
Canada Small Business Financing Program (CSBFP)
The Canada Small Business Financing Program is a government-backed business loan of up to $1 million. It is available to startups and small businesses with a gross annual revenue of $10 million or less. The loan can be used for almost any purpose, including working capital, buying equipment or real estate, and refinancing debt. You can apply for the CSBFP loan through a participating bank or credit union.
How to apply for a $250k business loan
The application process for a $250k business loan might be more involved than an application for smaller amounts of funding. While the application varies depending on the type of financing and the lender, you’ll usually follow these steps:
Decide on the type of financing your business needs. An equipment loan is the way to go if you need to buy an excavator or new office furniture. But a line of credit is more useful if you regularly need working capital.
Compare different types of lenders that offer the type of financing you need. If you have time, set up an appointment with a local bank and reach out to providers that offer small business loans.
Collect the documents you need to complete the application. For a $250,000 loan, you typically need business and personal tax returns and bank and financial statements at a minimum.
Complete the application by following the lender’s instructions. If you’re applying for a government-financed loan, this involves completing multiple forms — though you can hire a service to cut down on time and effort.
Get your collateral appraised if your lender requires it. This mainly applies to equipment loans and financing to stock up on inventory.
Review and sign your loan offer, paying attention to the rates, terms and payment due dates.
A $250,000 loan often takes a few days to a few weeks to process. Lenders prefer to be thorough when it comes to loans of this size — even online providers.
How much does a $250k business loan cost?
The cost of your $250k loan depends on the rates, fees and loan terms your business receives.
For example, a $250,000 loan with a 5% APR and a 10-year term would cost your business about $2,652 each month and a total of almost $68,197 in interest. Use our calculator to see how much a $250,000 business loan might cost at different rates and terms.
Business loan calculator
Use this business loan calculator to find out how much your monthly payments could cost.
You can apply for a $250k business loan through a bank, credit union, alternative lender or business loan broker. Banks and credit unions are a good option if you have an established business with positive revenue, but if you need more flexible requirements, you can apply to an alternative lender or broker.
Frequently asked questions about $250k business loans
How much you can borrow for a business loan depends on several factors, including your credit score, debt-to-income ratio, collateral and business revenue.
Document requirements will depend on the lender, but generally, you’ll need to provide business financial statements, business and personal tax returns, your business certificate or licence, and a copy of your business lease if you’re renting space or leasing equipment.
Anna Serio is a lead editor at Finder, specializing in consumer and business financing. A trusted lending expert and former certified commercial loan officer, Anna's written and edited more than 1,000 articles on Finder to help Americans strengthen their financial literacy. Her expertise and analysis on personal, student, business and car loans has been featured in publications like Business Insider, CNBC and Nasdaq, and has appeared on NBC and KADN. Anna holds an MA in Middle Eastern studies from the American University of Beirut and a BA in Creative Writing from Macaulay Honors College at Hunter College, CUNY.
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