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Charles Schwab business loan alternatives
Don't want to use your investment portfolio as collateral? You've still got options.
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If you’re looking to borrow funds for your business, Charles Schwab won’t be much help if you don’t want to put up your personal assets as collateral. Instead, you might want to consider one of these alternatives that offer unsecured term loans and lines of credit.
Why doesn’t Charles Schwab offer business loans?
Charles Schwab’s banking model is primarily focused on investments and trading, which is why it offers very few loans. Though it does have two secured personal line of credit options that can be used to fund business expenses, you’ll need sufficient collateral to open a line. And you risk losing your assets if you’re unable to handle repayments.
3 alternatives to Charles Schwab business loans
These three providers offer a variety of business loan options that don’t require collateral.
Best for poor credit: Main Street Finance Group
Main Street Finance Group is a private lender that offers a variety of business financing options, including unsecured lines of credit and term loans. To qualify, your business must bring in at least $10,000 a month and have no more than five overdrafts or negative days each month. While these requirements may be strict, they allow Main Street to rely less on your personal and business credit scores — handy if you’re just starting out or have had financial issues in the past.
However, depending on the type of loan you take out and your financial situation, you may only qualify for daily repayments. These can be difficult to handle if your business relies on seasonal sales.
- How much you can borrow. $5,000 to $1,000,000
- APRs. N/A
- Terms. N/A
- Eligibility requirements. 1+ years in business, $10,000+ monthly revenue
Best for unsecured business lines of credit: Kabbage
If you’re still looking for a line of credit but want one that’s designed specifically for businesses — and doesn’t require collateral — then Kabbage may be a good choice. It’s one of the few lenders that provides easy access to your credit line, allowing you to draw funds through its app or card.
Though it offers a low minimum borrowing amount of just 6, lines are capped at $250,000. This means it might not be ideal if you’re looking to make several large purchases — a term loan might be more useful. You’ll also want to watch out for its short loan terms that range from just 6 to 12, which can make for high monthly repayments.
- How much you can borrow. $500 to $250,000
- APRs. N/A
- Terms. 6 to 12 months
- Eligibility requirements. 1+ years in business, $100,000+ annual revenue or $4,200+ monthly revenue over last 3 months
Best for comparing a variety of lenders: LendingTree
LendingTree isn’t a direct lender. Instead, it allows business owners to compare multiple loan offers by filling out just one online form. Because there are dozens of lenders in its network, you’ll have access to a variety of financing options, including short- and long-term loans, lines of credit, accounts receivable financing and working capital loans.
You have to provide a good deal of information to prequalify with these different lenders, though, including bank statements, balance sheets and tax returns. And you may end up fielding phone calls from lenders in its network even after you’ve secured a loan.
- How much you can borrow. N/A
- APRs. N/A
- Terms. Varies by lender and type of financing
- Eligibility requirements. Varies by lender, but many require good personal credit, minimum annual revenue and minimum time in business
Does Charles Schwab offer similar loans?
Yes, Charles Schwab has two personal line of credit options that could be used for business purposes:
- Pledged Asset Line (PAL). This secured line of credit allows you to borrow between $100,000 and $20 million by putting your equity securities, mutual funds, CDs or bonds up as collateral.
- Margin loan. Unlike the PAL, this secured line of credit doesn’t require an expansive portfolio — you can borrow with as little as $2,000 in eligible securities.
Charles Schwab also has a few other non-lending business products, including small business retirement plans, organization accounts, CDs and money market funds. And since its main focus is on investments, you may want to take advantage of its investment services to help keep your business funds growing.
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Bottom line
While Charles Schwab does have options for business owners, they can be limiting — especially if you don’t want to risk your personal investment portfolio. To find other ways to fund your business and compare more lenders, check out our guide to business loans.
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