Funding questions, answered directly
Plain-English answers to the questions small business owners ask before they apply — grouped by topic so you can scan to what you actually need.
Other questions7
Are Online Business Lenders Legit?
Yes, many online business lenders are legitimate, regulated institutions. The Federal Reserve's 2025 Small Business Credit Survey found 32% of small businesses applied for financing through them. Still, the industry includes both reputable providers and predatory operators, so vetting lenders carefully is essential.
Can I Get a Business Loan with Bad Credit?
Yes, you can get a business loan with bad credit, though options and costs differ. Alternative lenders, revenue-based financing, and secured loans regularly approve applicants with FICO scores below 600. The tradeoff is higher rates—often 20% to 50% APR or more—and shorter repayment terms.
Can I Get a Startup Loan With No Revenue?
Yes, startup loans are available without revenue, though options are limited. SBA microloans, personal credit-based loans, grants, and crowdfunding can fund pre-revenue startups. Instead of business financials, lenders evaluate your personal credit, business plan, collateral, and industry experience.
Do I Need Collateral for a Business Loan?
Not always. SBA microloans, lines of credit under $100,000, and short-term working capital loans often skip collateral. But traditional bank term loans, SBA 7(a) loans over $50,000, and equipment financing usually require assets as security. Your credit, revenue, and loan size drive the requirement.
Fastest Way to Get Business Funding?
Online lenders and fintech platforms offer the fastest business funding, with approvals in 24-72 hours. Merchant cash advances and business lines of credit fund within a day, while online term loans take 1-3 days. Traditional bank and SBA loans are cheaper but require 2-12 weeks.
What Credit Score Do I Need for a Business Loan?
Traditional business loans typically require a personal credit score of 670+, and SBA loans usually need 680+. Alternative lenders may approve scores as low as 500-550. Your score impacts not only approval but also interest rates, loan amounts, and repayment terms available to you.
What Is SmarterLends and How Does It Work?
SmarterLends is a business financing marketplace connecting small business owners with 75+ vetted lenders through one application. We analyze your profile, funding needs, and qualifications to match you with relevant loan offers—saving time and helping you find competitive rates and terms.
Best loans by use case2
Best Business Loan for Restaurants
The best restaurant loan depends on your needs. SBA 7(a) loans offer the lowest rates for established restaurants seeking growth capital. Equipment financing suits kitchen upgrades, while lines of credit provide flexible working capital for managing the seasonal cash flow swings common in food service.
Best Business Loan for Trucking Company
The best business loan for a trucking company depends on your specific need. SBA 7(a) loans offer the lowest rates for general purposes, equipment financing provides the easiest approval for truck purchases, and business lines of credit deliver flexible working capital for fuel and maintenance costs.
Comparisons3
Business Loan vs Personal Loan for Startup: Which Should You Choose?
Business loans are usually better for startups—they build business credit, offer higher limits, and shield personal liability. Personal loans, however, are faster to secure when you lack business history. Your best choice depends on credit profile, funding needs, and timeline.
Merchant Cash Advance vs Term Loan: Which Is Right for Your Business?
Merchant cash advances offer fast funding repaid via daily card sales at factor rates of 1.1-1.5. Term loans provide fixed monthly payments at lower APRs of 7-30%. Choose an MCA for speed and strong card sales; choose a term loan for planned investments where lower total cost matters.
SBA 7(a) vs 504 Loan: Which Is Better for Your Business?
The right choice depends on your use of funds. SBA 504 loans offer lower rates and longer terms for real estate and equipment purchases. SBA 7(a) loans provide flexibility for working capital, inventory, and general business needs. Choose 504 for real estate savings; 7(a) for versatility.
How-to guides3
How Long Does an SBA Loan Take?
SBA loans typically take 30 to 90 days from application to funding, though timelines vary significantly by loan type. SBA 7(a) loans average 45-60 days, while 504 loans can take 60-90 days due to their dual-approval structure. SBA Express loans offer the fastest option at 7-14 days for smaller amounts.
How Much Can I Borrow for My Business?
Small businesses typically borrow $5,000 to $5 million, based on loan type, revenue, time in business, and credit. SBA 7(a) loans cap at $5 million; microloans at $50,000. Revenue-based financing offers 10-25% of annual revenue, while bank term loans average $100,000-$500,000 for established businesses.
How to Qualify for an SBA Loan
To qualify for an SBA loan, you generally need a credit score of 680+, two years in business, revenue to cover debt payments, and collateral for loans over $50,000. Your business must be for-profit, U.S.-based, meet SBA size standards, and show it can't get credit elsewhere on reasonable terms.