Compare Your Small Business Loan Options

Updated on August 3, 2020
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Explore the top small business loans and find the right fit for your business’s needs.

At some point in the lifecycle of your business, you’ll need access to financing—whether to cover cash flow, expand your team, cover an emergency, purchase equipment, or for a different purpose altogether. Small business loans can offer you the capital you need to run and grow your business.

Traditionally, business loans were only available from established banks, which, although offering the best rates and terms, also require lengthy processes and the highest qualifications—making it difficult for many small business applicants to get the funding they need. Today, however, between banks, government-guaranteed loans, and alternative, online lenders, there are now more options than ever for small businesses to get access to capital—including everything from term loans to lines of credit to asset-based financing.

You can use this guide to learn more about the best business loan products and top lenders offering them. 

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Top Business Loans and Lenders in 2020

Compare the top loan options and lenders to see what’s right for you.

SBA Loans

SBA loans are government-guaranteed term loans that allow lenders to offer low-interest rates to business owners who might not qualify for a bank loan.

AmountTermsRatesSpeed
$5K - $5M5 - 25 YearsStarting at 6%As fast as 2 weeks
Pros

Lowest down payments. Longest payment terms. Reasonable interest rates.

Cons

Lengthy paperwork. Longer approval time. May require collateral.

Top SBA Lenders

Five Star Bank

Best for: Low-rate, SBA 7(a) loans.

First Home Bank

Best for: SBA 7(a) loans from an established 7(a) lending program.

Business Term Loans

Online term loans are lump sum loans designed to accommodate a wide variety of businesses and their funding needs. The repayment period and rates of an online term loan will depend on the lender—however, short-term loans can have a repayment period of a few months up to a year, and long-term loans from a year to five years.

AmountTermsRatesSpeed
$5,000 to $600,000About 1 to 5 years7% to 30%As fast as three hours
Pros

Set payment structure. Lower monthly payments and longer payment terms than short-term loans.

Cons

Potential prepayment penalties.

Best Online Term Loan Lenders

OnDeck Capital

Best for: Access to shorter-term financing with a pre-payment discount.

Business Lines of Credit

Business lines of credit are one of the most flexible forms of financing—giving you the ability to draw from a set pool of funds when you need capital. Unlike a traditional term loan, you’ll only need to repay the capital you withdraw, plus interest.

AmountTermsRatesSpeed
$5,000 to $250,000Up to 2 years7% to 25%As fast as one day
Pros

Only pay interest on funds drawn. Capital is available when needed. Bad credit is acceptable.

Cons

May require collateral. Higher rates for lower credit scores.

Best Line of Credit Lenders

BlueVine

Best for: Fast, accessible business lines of credit.

Invoice Financing

Invoice financing is a form of asset-based financing in which your unpaid invoices serve as collateral on the capital you borrow from a lender. Generally, invoice financing lenders can advance capital worth up to 85% of the value of your invoices with the 15% (minus fees) paid when your invoices are fulfilled.

AmountTermsRatesSpeed
Up to 100% of invoice valueUntil the customer pays the invoiceApprox. 3% processing fee, plus factor fee (~1%) each week until invoice is paidAs fast as one day
Pros

No need to wait for invoice payment. Invoices serve as collateral. Easier to qualify for.

Cons

Can have higher fees than traditional financing. Fees based on time for invoice to be paid off.

Best Invoice Financing Companies

BlueVine

Best for: Easier access to affordable financing to free up cash flow.

Equipment Financing

Equipment financing is a type of small business loan given for the specific purpose of purchasing new or used equipment. You can get an equipment loan equal to up to 100% of the value of the equipment you’re looking to purchase, which you’ll then pay back over time, with interest.

AmountTermsRatesSpeed
Up to the amount of equipment5 to 6 years4% to 40%As fast as 2 days
Pros

Quick access to cash. Limited paperwork. Equipment serves as collateral.

Cons

Equipment could be obsolete by the time the loan is fully repaid.

Best Equipment Lenders

Balboa Capital

Best for: Fast access to long-term equipment loans.

The Best Business Loans and Lenders, Summarized

Lender Best for Est. Interest Rates Min. Credit Score
Five Star Bank SBA loans Variable based on the Prime Rate 685
Celtic Bank SBA loans Variable based on the Prime Rate 640
First Home Bank SBA loans Variable based on the Prime Rate 650
OnDeck Online term loans 9.99% to 99% 600
BlueVine  Lines of credit  4.8% to 51% 600
BlueVine Invoice financing 0.25% to 1.7% per week 510
Balboa Capital Equipment financing 4% to 25% 600

Who Is Fundera?

Getting the right business loan for you can be challenging—there are many different loan types available, and many lenders offering them. If you just work directly with one lender, how can you be sure you’re getting the best type of loan, interest rates, and terms for your unique financing needs?

That’s where a marketplace like Fundera comes in.

Fundera connects small business owners to the best loan option for them through our online marketplace of vetted business lenders. With one simple application, you can see all the products and lenders you qualify for, and start evaluating which small business loan is best for your business. Fundera features leaders in every financial category, so you can rest assured that you’re accessing the best products on the market.

Small Business Loan Guides & Resources

Dive deeper into your small business loan options with our comprehensive guides on all things small business financing.

The Most Common Questions We Get About Applying for a Small Business Loan