Overview of Short Term Business Loans
Short term business loans come in handy when you need to borrow a relatively small amount of money (under $500K) and a fast and easy application process. We can help you get a low-rate short term business loan that you pay back in 1 month to 5 years.
Free Guide To
Small Business Financing
How Short Term Business Loans Work
Sometimes, you need a relatively small amount of financing for your business and can’t afford to spends weeks or months applying for a loan at a bank. Short term loans quickly get you the money you need without the hassle of a lot of paperwork, and you pay it back within a few months or years. Typically, you can borrow up to $500,000.
In general, you must pay back a short-term loan within 3 months to 5 years. Since the payback period is shorter than a traditional commercial loan, the interest rate and monthly payments will be higher. It's typical for borrowers to pay between 20-80 % APR, but you may get lower rates if you have excellent personal credit. On the plus side, you can get your money faster and get out of debt more quickly than you could with a traditional loan. There’s also usually no down payment or collateral required.
Short term business loans have a fast and easy electronic application process. In most cases, you can apply online and find out right away if you pre-qualify for the loan. You can normally get funding in less than 2 weeks.
Will I Qualify for a Short Term Business Loan?
The criteria for short term business loans vary, but here’s what you generally need to qualify:
Credit score above 550 (check your credit for free here)
More than $2,500 in monthly business revenues
Be in business for at least 1 year
In addition to the above criteria, you should also have a relatively clean financial history (e.g. no bankruptcies) and be prepared to show some basic business documentation (e.g. recent tax returns and/or bank statements).
Cost of Short Term Business Loans
The cost of a short term business loan depends on your personal credit score and your business’ financial history. Rates between 20-80 % are typical, but you may get a lower or higher rate. A business owner with an excellent credit score (680+) and highly profitable business revenues could get a short term loan with an APR as low as 6 % or 7 %. On the other end, a borrower with poor credit or a low-revenue business may have to pay a significantly higher rate.
Maximum Loan Amount
3 months - 5 years.
20-80 % on average
As fast as 1 business day.
Not required, but a lien may be placed on your business assets.
Have a question?
Get out of debt quickly by paying back within 3 months to 5 years.
Fast application and approval process.
Bad credit ok in some cases.
No collateral or down payment needed.
Higher interest rates than a traditional loan.
Can only borrow up to $500,000 with short term business loans.
Finding funding for a small business can be daunting. A Google search for “small business loan” brings up 180 million results! In part, this is because the last few years have seen a surge in business financing options. Nonetheless, some approaches stand the test of time. Here are 3 lessons you can learn from how […] Read More