Introduction
Access to capital is one of the most critical factors for small business success. Whether you’re starting up, expanding, or managing cash flow, small business loans in the US offer entrepreneurs the financial fuel they need to grow. But with so many options — from banks to fintech lenders — it can be overwhelming to choose the right path.
This guide breaks down the best small business loan types, top lenders, interest rates, application steps, and tips to increase approval chances.
Types of Small Business Loans
1. Term Loans
Borrow a fixed amount and repay over a set period with interest.
- Best for: Expansion, equipment, renovations
- Terms: 1–10 years
- Rates: 6%–30% APR
2. SBA Loans
Backed by the U.S. Small Business Administration, these offer low rates and favorable terms.
- Best for: Long-term funding, working capital
- Popular Programs: SBA 7(a), SBA 504
- Rates: Prime + 2.25% to 4.75%
3. Business Lines of Credit
Revolving credit line — only pay interest on what you use.
- Best for: Cash flow gaps, inventory
- Credit Limits: $10,000–$250,000
- Rates: 8%–25% APR
4. Equipment Financing
Use the loan to buy machinery or equipment, using it as collateral.
- Best for: Trucks, machinery, office equipment
- Rates: 4%–20% APR
5. Invoice Financing / Factoring
Borrow against outstanding invoices to improve cash flow.
- Best for: B2B companies waiting on payments
- Rates: 1%–3% per invoice monthly
6. Merchant Cash Advances (MCAs)
Advance based on projected sales; repay from daily card transactions.
- Best for: Businesses with strong credit card sales
- Rates: Factor rate (1.1–1.5), expensive
Comparison Table: Small Business Loan Types
| Loan Type | Loan Amount | Interest Rate | Term Length | Best For |
|---|---|---|---|---|
| SBA 7(a) | Up to $5 million | 6%–10% | Up to 25 years | General business needs |
| Term Loan | $5K–$500K+ | 6%–30% | 1–10 years | Expansion, big purchases |
| Line of Credit | $10K–$250K | 8%–25% | Revolving | Seasonal or emergency funds |
| Equipment Loan | Up to equipment value | 4%–20% | Equipment life | Buying new tools or gear |
| Invoice Financing | Based on invoices | 1%–3% monthly | Short-term | Late-paying clients |
| MCA | $5K–$500K | High (factor-based) | Short-term | Fast cash for sales-heavy |
Top Small Business Lenders in the US (2025)
| Lender | Loan Type | Loan Amount | Minimum Credit Score | Time to Fund |
|---|---|---|---|---|
| BlueVine | Line of Credit | Up to $250,000 | 625+ | 24–48 hours |
| Fundbox | Line of Credit | Up to $150,000 | 600+ | 1–3 days |
| Lendio | Multiple Loan Options | Varies | 550+ | 1–5 days |
| Kabbage (AmEx) | Line of Credit | Up to $250,000 | 640+ | 24–72 hours |
| OnDeck | Term Loan / Line | Up to $250,000 | 625+ | Same day |
| Wells Fargo | SBA & Term Loans | Up to $5 million | 680+ | 7–30 days |
| Chase Bank | SBA & Business Loans | Varies | 700+ | 2–4 weeks |
How to Qualify for a Small Business Loan
Key Requirements:
- Good personal and business credit score (600–700+)
- Business age (6 months–2 years minimum depending on lender)
- Annual revenue ($50K–$250K+)
- Business plan and use of funds documentation
Documents You’ll Need:
- Tax returns (business & personal)
- Bank statements (3–6 months)
- Profit and loss (P&L) statement
- Business license
- Articles of incorporation
Application Process: Step-by-Step
- Determine how much you need and what you’ll use it for.
- Compare lenders and loan types based on rate, terms, and funding speed.
- Check your credit score and improve it if possible.
- Gather financial documents before applying.
- Apply online or in person and await approval.
- Review the loan agreement and understand the repayment terms.
- Receive funds — often within days if using online lenders.
Pros and Cons of Small Business Loans
| Pros | Cons |
|---|---|
| Access to growth capital | Some options have high interest |
| Improves cash flow | May require collateral or guarantee |
| Builds credit history | Approval isn’t guaranteed |
| Multiple options for different needs | Complex documentation |
Tips for Getting Approved
- Build your credit score ahead of time
- Limit existing debts or credit utilization
- Have a strong business plan
- Apply for the right loan type for your situation
- Show stable revenue or contracts
FAQs: Small Business Loans in the US
Q1: What is the easiest small business loan to get?
A: Online lenders like Fundbox or BlueVine often have lenient requirements and faster approval.
Q2: Can I get a business loan with bad credit?
A: Yes, but rates will be higher. Consider invoice financing or MCAs with caution.
Q3: Are SBA loans hard to get?
A: They’re competitive and require paperwork but offer the best rates if you qualify.
Q4: Do I need collateral for a business loan?
A: Some lenders require collateral, especially for large amounts. Others offer unsecured loans.
Q5: How fast can I get the funds?
A: Some online lenders disburse funds in under 24 hours. SBA loans may take weeks.
Final Thoughts
Choosing the right small business loan in the US can fuel growth, cover expenses, or help you seize new opportunities. Whether you go with a traditional bank, fintech lender, or SBA-backed option, it’s critical to compare rates, understand the terms, and borrow responsibly.