Editor's choice: Lendio business loans
- Network of over 300 lenders
- 10 types of financing available
- Positive reviews of customer service
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Not sure your business is eligible for a loan? Generally, you may have better luck with online lenders and local financial institutions than with big banks. You also might want to look beyond the traditional term loan or line of credit. But beware: Loans that have minimal requirements are often more expensive.
Businesses in high-risk industries
Working capital term loansMerchant cash advances
6+ months in business, $15K+ in monthly deposits, 550+ credit score
Factor rates as low as 1.15%
Business owners with bad credit
600+ personal credit score, 1+ years in business, $100,000+ annual revenue
Businesses that rely on invoices
2+ years in business, $30,000+ in monthly revenue, 650+ credit score
Become (formerly Lending Express)
At least 3 months in business with $10,000 in monthly revenue or at least 6 months in business with $3,000 in monthly revenue.
$5,000 to $500,000
Starting at 7.5%
0.5 years to 10 years
Businesses with low monthly revenue
Lines of credit
1+ years in business, $100,000+ annual revenue or $4,200+ monthly revenue over last 3 months
$500 to $250,000
Flat fee based on repayment term
6 to 12 months
Credibly is an alternative business loan provider with minimal eligibility requirements. For its working capital loans, it emphasizes your business’s cash flow: How much you deposit into your bank account each month and the number of negative cashflow days.
It’s also open to working with businesses in high-risk industries, including real estate companies and law firms. It takes just 24 hours to hear back about approval, and your funds can be disbursed as soon as the same day.
OnDeck is an online lender that looks beyond your credit history when evaluating your application for a loan. You only need a credit score of 500 to be eligible for its term loans, though you must be in business for at least one year. You’ll also have better luck if your business has a strong cash flow.
Applying is also easy: Complete an online application and wait a few minutes for OnDeck to make a decision. After you’ve submitted your documents and signed the contract, you could receive your funds in as little as one business day.
BlueVine is best known for its invoice factoring, though your business can also apply for a line of credit. Because invoice factoring involves selling your business’s unpaid invoices at a discount, your credit and time in business aren’t as important as the value of your invoices.
While BlueVine doesn’t offer invoice factoring to businesses in the healthcare or medical industries, you might be eligible for a line of credit instead. This type of financing comes with stricter eligibility requirements and isn’t available in all states.
Applications are typically approved within 24 hours, and you may be able to receive your funds just a few hours later.
Become is an online connection service that offers a wide range of financing options for businesses. It could be particularly useful to business owners who’ve never applied for a loan before: You can easily compare multiple offers that you might not have found on your own.
You only need to be in business three months to be eligible, though most lenders require at least six. Prequalifying through Become takes minutes. And if approved by one of its partners, you could get your money in as soon as 24 hours.
Kabbage lines of credit are simple to use and require a monthly revenue of $4,200 to qualify. Like OnDeck, Kabbage looks beyond revenue and credit scores when it considers your application. You can increase your chances of approval by linking your business accounts like PayPal and QuickBooks during the application process.
After you qualify for a loan, access your credit line by logging in to your account online, using the Kabbage app or swiping your Kabbage card. Each withdrawal turns into a six- or 12-month loan, which business owners repay plus a fee.
The application and approval process takes just 10 minutes. Plus, you could get your funds just a few minutes later, depending on the account you have them sent to.
It depends on your business and the type of financing you’re looking for. Generally, businesses that have been around for a few years, are cashflow positive and have owners with strong personal credit will see more options. Unsecured term loans and lines of credit are typically more difficult to qualify for than those that require collateral.
Other types of working capital financing, like merchant cash advances and invoice factoring, are also often easier to qualify for than a term loan.
Businesses in some industries might still have trouble qualifying for a business loan, no matter how strong their finances.
These riskier industries include:
Nonprofits and sole proprietorships also tend to have a harder time with business loan approval, regardless of the industry.
Getting a business loan as a startup is often difficult, because you often can’t meet the minimum revenue and time-in-business requirements. Some alternative lenders offer business financing based on your financial projections, but it can be expensive.
If you’re employed and have strong personal finances, consider a personal loan instead. These loans typically have lower rates and more forgiving terms than startup loans.
Or look into investor funding. You’ll lose some equity in your business, but you won’t be on the hook for repayments, and you don’t need to meet the same requirements as a business loan.
You might have better luck finding an easy business loan to qualify for online or at your local financial institutions. Borrowing from an online lender is often quick and simple, but it can be expensive. And while local banks and credit unions sometimes have lower rates, they can take much longer to process your application.
To find the best rates and terms you’re eligible for, start your search with lenders designed to serve a broad range of borrowers and needs.
Community development financial institutions (CDFIs) have the highest rate of approval among all business lenders, according to a 2017 Federal Reserve survey. A CDFI can be a bank, loan fund, credit union or even venture capital firm with a mission to empower underserved and underrepresented communities.
CDFI loans might be best for businesses that’ve been around awhile but have low revenue because of the nature of their work — many accept applications from nonprofits. Business owners who are minorities, women or veterans could also have an easier time with approval, as could businesses that serve an economically disadvantaged community.
New business owners who don’t meet the eligibility requirements at their local bank might want to consider an online connection service. These services are often free to use and can give you an idea of the rates, terms and loan amounts your business is eligible for from multiple lenders. If you’re happy with one of the offers, you can typically go directly to the lender’s site to complete an application.
A downside of using connection services is that they tend to operate on a pay-per-lead model, meaning that the pool of lenders can be limited. For the most options, try to find a service that works with at least 75 partners.
Businesses that rely on invoices from other businesses or government agencies could have an easier time qualifying for invoice factoring than for other types of financing. That’s because your business might not have the cash flow to qualify for a traditional business loan or line of credit.
Factoring companies also often work with businesses in high-risk industries like trucking companies. However, this option can be more expensive than traditional business financing. And you might get locked into a yearslong contract.
Factoring companies buy your business’s invoices at a discount and give you between 85% to 95% of their value up front. After your clients fill their invoices, your business gets the rest of the value less a service fee.
If you own a retail businesses with regular credit card sales, you might want to look at merchant cash advances if you’ve had trouble qualifying for a business loan. Merchant cash advances work like an advance on your company’s future sales, which you repay plus a fixed fee with a percentage of each credit card transaction.
Typically, your business needs to meet monthly sales requirements to qualify. And like factoring, merchant cash advances can be more expensive than other financing options.
Ready to apply for financing? Speed up the application process with these simple tips:
Going local or online is often the best way to find a business loan that’s easy to qualify for. However, easy business loans can sometimes be more expensive than other options, especially if they don’t require collateral.
To learn more about your financing options and compare lenders, read our guide to business lending.
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