OnDeck lists some basic qualification requirements for a business loan, including a minimum personal credit score of at least 600 for a long-term loan. You must also be active for at least a year and you must have at least $ 100,000 in annual operating income to be eligible. We chose OnDeck because they already offer loans for small businesses with money on the same working day. This can be critical for entrepreneurs who need quick cash access to track operating costs or pay for important equipment right away. Because Fundera is a marketplace, it can offer almost any type of commercial loan or credit line available today.
Most traditional business loans offered by private lenders do not process a loan application unless it is accompanied by a detailed business plan. Without one, it is very difficult for a potential lender to assess whether their idea is commercially viable. To obtain financing for your business, you may also need to provide a business plan and copies of the financial statements, including a profit and loss small business lending account, balance sheet and cash flow statement. Similarly, expect to provide information about debtors and creditors, as well as details about existing debt. Depending on your creditworthiness and type of loan, you may also need to provide proof of warranty. Interest rates on equipment financing may be lower than those available through other types of financing and generally range from 8% to 30%.
This includes loans through the Small Business Administration, which typically come with flexible payment terms and affordable interest rates. The guarantee is an asset that lenders can legally seize if you cannot make payments, including commercial buildings, equipment and debtors. Some entrepreneurs choose to use their personal belongings, including their homes, as collateral for a business loan.
If you have a less than great credit score, you have a better chance of getting approved with an alternative lender than a traditional bank. SBA loans are another option, but the time to apply for approval can take much longer than with an online lender. Small business loans are available from various traditional banks and credit unions, as well as from online lenders. However, each lender is limited by its own financial products and loan requirements.
SBA loans are available in amounts from less than $ 50,000 to $ 5 million and offer low rates and favorable repayment terms. The loan process can take weeks or months, depending on the type of SBA loan you are trying to obtain. This pilot loan program offers loans through mission-oriented lenders, who are generally non-profit financial intermediaries that focus on economic development.
While the SBA wants to make it easier for you to receive a small business loan, you are not assured of approval. Lenders continue to analyze your financial statements and credit information. They want to see that you have a proven ability to repay the loan, otherwise you could disqualify your loan application. Although the SBA is an information center for loans to small businesses, it is not they who actually provide the loans. The role of the SBA is to guarantee part of your loan to reduce the risk to the bank or financial institution that delivers the money.
We are also looking for lenders who offer high amounts of loans and flexible payment options, as well as the ability to apply for and raise funds for online loans. We analyze more than 20 lenders who provide loans for small businesses, credit lines for small businesses and unique financing options such as billing. Fundera is an excellent option for consumers who want to qualify for an SBA loan, mainly because it allows you to complete one application and compare multiple SBA loan options in one place.
Kabbage prides itself on the easy online application process and fast financing for those who have been approved. While it is generally a last resort for entrepreneurs who have already refused commercial loans, the SBA Express loan should not be undervalued. There is no better option on the market when it comes to response time after application.