The Best Places to Get a Small Business Loan

Top Sources of Small Business Loans Today

Right now could be the best time for small business loans because of the subprime mortgage crisis in 2008. The improved economic conditions, mixed with a significant increase in competition, indicates more lenders are inclined to slash their small business loan rates for good prospects. Sadly, that does not mean it is simple to obtain a small business loan from traditional banks. You should still try- you will often receive a lower interest rate if you can qualify. However, if you are like the majority of small businesses, you might come up empty.

Luckily, various online lenders are offering banks a run for their money (and customers) by working directly with small business owners. In most cases, these organizations make the lending process more convenient, quicker turnaround, more flexible lending criteria, and more transparent terms. Nevertheless, be aware that you will possibly be getting a higher APR if you select an online lender. If you are searching for a small business loan, here are the best places to get a small business.

Best overall for small business: Lendio

Lendio is the leading business loan company for most businesses. That is because Lendio is more like a loan matchmaker than a lender- which is good news. Just fill out a fifteen-minute online application, then Lendio will utilize your application to match you with the right lenders and loans for your business. Within seventy-two hours, it offers you a list of loans, for you can select the best loan and finalize things.

Lendio partners with over seventy-five lenders (including some on this list), which improves your chances- not to mention your efficiency. Those lenders provide everything from merchant cash advance to short-term business loans to real estate loans to equipment financing. Given its many personalized and options loan matchmaking, Lendio should be a no-brainer for just any business.

Best for larger cash flow loans: BlueVine

BlueVine has three types of funding options: term loans, invoice factoring, and lines of credit. Whereas all three are decent choices, it is that last one that makes BlueVine stand out. Besides, having an easy as pie application, BlueVine provides invoice financing up to $5 million.

With invoice financing, your invoices serve as collateral for your loan- and that collateral makes these loans simpler to qualify for than other financing types (it also means that usually, only B2B businesses qualify). And sure enough, BlueVibe has comparatively lax application requirements- just three months in business, $100,000 in annual revenue, and a 530 credit score. Of course, you possibly will not qualify for that full $5 million with just the bare minimum qualifications; however, BlueVines makes large loans more attainable.

Best for low credit: Fundbox

Fundbox provides lines of credit. And instead of making you fill out a detailed application, Fundbox connects with your banking account or your accounting application. Provided the automated algorithm likes what it sees; you will get approved within minutes. Apart from being convenient and fast, Fundbox’s loan application is great for businesses with low credit since Fundbox has one of the lowest minimum credit scores out there. Whereas Fundbox’s funding products are not the cheapest out there, its accessibility makes it a great option for businesses that can not qualify for low-interest term loans.

Most convenient: Kabbage

Kabbage provides only lines of credit. Similar to Fundbox, Kabbage has an automated application that just needs you to connect Kabbage with your bank account- no tax documents or credit score required. In most situations, that means you can get a response to your application in mere minutes, making Kabbage a convenient and fast way to apply for funding.

However, a convenient application is just the beginning. After you are approved, Kabbage allows you to access your credit line through PayPal, physical card, or your bank account. With PayPal, you can access financing in minutes; the Kabbage Card (after you get it in the mail) offers you instantaneous access to your credit line. So whereas Kabbage has high rates, its convenience makes it suitable for business owners that need fast, available working capital.

Best for peer to peer lending: Funding

Funding Circle is a peer to peer (P2P) lender, so it is technically connecting you to investors instead of lending you directly. You possibly will not notice much of a difference as a borrower, since you will still apply, get loaned, and make monthly payments through Funding Circle. Often, Funding Circle’s P2P model indicates that it provides rates on term loans- if you can qualify.

Funding Circle has some of the lenders’ stiffest application qualifications on this post (it puts more weight on a full two years in business, for instance); however, it also has some of the lowest rates. Besides, Funding Circle is one of the few alternative lenders that allows you to make monthly payments (instead of weekly or daily). All that makes Funding Circle a great deal, if you can get it. Note that Funding Circle has begun providing SBA business loans too. But note that they have even higher borrower requirements than Funding Circle’s usual loans. 

Best for microloans: Kiva

Kiva exclusively provides microloans- in this event, loans under $10,000. A lot of small businesses will require a larger loan, which is why Kiva is not in the top five in this list. Even so, if you are in the market for a little loan, you cannot go wrong with Kiva- it provides an unbeatable zero-percent interest rate. The catch? There is a lengthy financing process that needs you to get your friends and family to contribute to your loan before crowdfunding the rest. Still, that zero-percent rate makes Kiva a worthy crowdfunding platform for anyone who requires a smaller business loan (and can wait a while to get it).

Best for repeat borrowing: OnDeck

If you think you will be taking out several short or long term loans over the next few years, you should check out OnDeck. This lender provides incentives like lower rates and decreased fees to its repeat customers, which indicates you can get better deals for your loan the more you borrow. Luckily, the vast majority of OnDeck’s customers have just but great things to say about the company, so you are likely to have a good experience as you borrow. Just bear in mind that OnDeck has higher application qualifications than some of the other lenders on this list. Therefore, brand-new businesses should apply elsewhere.

Best for startup loans: Accion

Contrary to most lenders, Accion wants to understand your business and what makes it unique in the industry. So while it certainly will look at your annual revenue and credit history, Accion’s application process enables you to create a case for why your business deserves the financing. There are some warnings, though: Accion’s application takes longer than any of the lending companies on this list. Also, if you need a large loan, Accion may not be your best bet: whereas it provides loans up to $1 million, its loans tend to be closer to $15,000. Still, if your startup requires a loan, Accion may be the unique lender you need.

The best balance of rates and requirements: StreetShares

StreetShares does not have the best lowest requirements and rates out there; however, it might have the best combination of the two. SreetShare’s requirements include a fair credit score and just $25,000 in revenue; however, it provides you the opportunity to qualify for rates as low as seven-percent, almost as good as what you can get from traditional banks. (Naturally, the stronger your application, the better the rates you can anticipate actually to get). Thus if you want to try to get lower rates, despite not having a ten-year-old, $1 million revenue company, check out StreetShares.

Best for non-loan financing: Lendr

Lendr only provides non-loan types of working capital- invoice financing and merchant cash advances, to get specific. Those kinds of funding come with higher costs and shorter repayment terms than traditional loans. However, they also come with low credit requirements, making them an essential source for some businesses. Besides, Lendr is a better working capital provider than most lenders. It has got excellent reviews and fair borrower requirements. If you need working capital funding, Lendr is one of the best providers you have.

Best for SBA loans: SmartBiz

If you are only interested in SBA loans, then check out SmartBiz. It claims to simplify the SBA application procedure with its loan marketplace. Similar to Lendio, SmartBiz delivers your one application to multiple lenders, matching you with your best options. However, unlike other lending marketplaces, SmartBiz deals exclusively with SBA loans. That makes its application requirements stiffer; however, it also indicates you can get super low rates.

If your company meets the qualifications for SBA loans, use SmartBiz to streamline your application process. Generally, Lendio is the best small-business loan company for most businesses, thanks to its many options and personalized matchmaking. However, ultimately, you know your company best. With this list of the best small-business loans, you can find the lender and loan that fits your unique needs- and utilize that newfound working capital to grow your business.

About Author