Small Business Loans: Types, Costs and What It Takes to Qualify
A small business loan is any financing a lender provides to a business. That covers term loans, lines of credit, SBA loans, equipment financing, invoice financing and merchant cash advances, which are technically not loans but advances against future sales. The type that fits depends on four things: how much you need, how fast you need it, what the money is for, and your revenue, time in business and credit. Below, the main types sit side by side with typical amounts, costs and speeds, followed by the minimums lenders publish and plain answers to the questions owners ask most. None of it is an offer. Figures are typical ranges or published floors, not quotes.
What types of small business loans are there?
Seven, if you split term loans into bank and online: SBA loans, bank term loans, online term loans, lines of credit, equipment financing, invoice financing and merchant cash advances. They run from the cheapest and slowest, SBA loans, to the fastest and costliest, merchant cash advances.
Small business loan types compared
| Type | Typical amount | Cost | Typical speed | Typical published floor (lenders' own sites, last checked September 24, 2026) | Best for | Guide |
|---|---|---|---|---|---|---|
| SBA loans | Microloans up to $50,000 and 7(a) up to $5 million, as published by the SBA | Microloans generally 8% to 13%, per the SBA. 7(a) interest is capped by the SBA, at 10% to 13.5% for variable rates as of September 2026 | Weeks to months (typical range, not an SBA timeline) | The SBA publishes no minimum score for 7(a); the borrower must be creditworthy, and the lender sets its own bar | Large, planned needs where weeks of processing cost you nothing | SBA Loans: Which Program Fits Your Business? |
| Bank term loan | Varies widely (typical range) | 6% to 20% APR (typical range) | Weeks (typical range) | Published by banks: about 2 years in business and a personal score of 660 to 700 or higher | Two or more years of trading, clean statements and time to wait | Business Loan Requirements by Lender (2026) |
| Online term loan | Varies widely; online term loans generally top out around $500,000 (typical range) | 15% to 45% APR (typical range) | 24 to 48 hours (typical range) | Published by online term lenders: about 1 year in business and a personal score of about 625 | A known amount, a fixed payment and speed worth paying for | What are your options for a business loan under $50,000? |
| Line of credit | Varies widely; lines rarely go past $500,000 (typical range) | Priced like an online term loan, and you pay interest only on what you draw (typical range) | 1 to 3 business days (typical range) | Published by lenders: online about 1 year and a score of about 625; banks about 2 years and 660 to 700 or higher | Recurring or uneven needs such as seasonal stock, payroll gaps or staged projects | Business Loan vs Line of Credit: Which Is Better for Your Small Business? |
| Equipment financing | Tied to the value of the asset (typical range) | Usually below unsecured products, because the asset secures it (typical range) | Days, varying with the vendor (typical range) | Published by some lenders: 2 or more years under current ownership and a solid credit history, with no score listed | Buying something that holds resale value | Can you get a business loan in your first year? |
| Invoice financing | A share of the invoice, often up to 90% (typical range) | A fee for each period the invoice stays unpaid (typical range) | 24 to 72 hours (typical range) | No minimum appears in the published floors we reviewed | B2B businesses waiting on invoices they have already issued | What Business Financing Costs |
| Merchant cash advance | Varies widely (typical range) | Factor rates roughly 1.1 to 1.5, equivalent to APRs of 40% to 350% (typical range) | Same day to 24 hours (typical range) | Published by lenders: about 6 months in business and a personal score of 550 | Speed that decides the outcome, when cheaper products are closed to you | Can you get a business loan with bad credit? |
Typical ranges, not offers. The SBA publishes its loan amounts, the microloan rate and the 7(a) rate caps. Every other cost and speed is a typical market range that nobody publishes as a commitment. Floors are the minimums lenders publish on their own sites, last checked September 24, 2026, and lenders change them. For the lender by lender table, read Business Loan Requirements by Lender (2026).
Rates differ by lender type and move with the prime rate, which went from 6.75% to 7.00% on September 17, 2026. The published caps, survey medians and typical ranges for each type, with their dates, are in Business loan rates in October 2026: what each type of lender charges.
What do you need to qualify for a small business loan?
Lenders check four things: monthly revenue, time in business, personal credit and cash flow. Published minimums commonly sit around a personal credit score of 625 to 660, 12 months in business and $100,000 in annual revenue, with banks above that and merchant cash advances below. Many lenders also look for cash flow of about 1.25 times the new payment, which our Business Loan Calculator: Monthly Payments and How Much You Can Borrow works out. Meeting a floor only means you can apply; Business Loan Requirements by Lender (2026) lists them lender by lender, and What Do Lenders Look for When Approving a Business Loan? explains how lenders weigh the rest.
Which business loan fits your situation?
The one that matches your amount, revenue, credit and time in business, so start with the guide closest to your situation.
Under $50,000. More products work at this size than for larger amounts: online term loans, lines of credit, equipment financing and SBA microloans. Because the price gap between products is large compared with the loan, the product matters as much as qualifying. What are your options for a business loan under $50,000?
Around $100,000. Revenue decides a request this size, because a lender wants to see that your deposits can carry the payments. Equipment financing can reach large amounts on less revenue when the money buys an asset, and SBA 7(a) loans open up if you can wait. What does it take to borrow $100,000 for your business?
Credit under 600. It is possible, with fewer options and higher costs. Equipment financing is often the most realistic cheaper route, while advances ask the least of your credit and cost the most. Low credit tends to arrive with low revenue, and lenders read the two together. Can you get a business loan with bad credit?
In business under a year. Sometimes, and equipment financing is the strongest fit, because the equipment secures the loan when you have little trading history. Many lenders look for a year or more, two or more years typically opens bank and SBA lending, and SBA microloans set no minimum time in business. Can you get a business loan in your first year?
Low revenue. Yes, through a narrower set of routes. SBA microloans were built for smaller and newer businesses, equipment financing leans on the asset as well as the revenue, and advances have the loosest criteria at the highest price. Many lenders look for around $10,000 a month, so a request sized to your deposits is easier to place. Can you get a business loan with low revenue?
Payroll, stock or a slow-paying customer. A working capital loan covers everyday costs rather than long-life assets, and it comes in several forms: a short-term online loan, a line of credit, invoice financing, an advance or an SBA 7(a) loan. Speed and cost trade against each other, so the right form depends on how predictable the need is and how soon you need the money. What is a working capital loan, and which kind fits your business?
Uneven cash flow. A business line of credit lets you draw only what you need and pay interest on the amount drawn, so it suits a need that comes in uneven amounts. It saves money only while part of the limit stays untouched, and fees are common, so compare the total cost before you open one. How does a business line of credit work, and can your business get one?
Speed when cheaper options are closed. A merchant cash advance pays a lump sum now in exchange for a share of future sales, and it is usually the quickest to arrive and the easiest to qualify for. It is also usually the most expensive, so compare the total repaid in dollars before you sign. How does a merchant cash advance work, and what does it really cost?
A machine, a vehicle or a tool. Equipment financing pays the seller and uses the equipment itself as collateral, which usually makes it cheaper than unsecured financing and often reachable earlier in a business's life. Match the term to the equipment's working life, because the tax treatment of the purchase can change the real cost. How does equipment financing work, and what does it really cost?
Two wider guides sit beside these. SBA Loans: Which Program Fits Your Business? compares the SBA programs, and Business Loans by Industry shows what businesses in each industry borrow for and which products fit.
What is the easiest small business loan to get?
Merchant cash advances first, then online term lenders, because they publish the lowest minimums. They are the easiest to qualify for and usually cost the most. Published floors for advances sit around 6 months in business and a 550 score, against about a year and 625 at online term lenders and about 2 years and 660 to 700 or higher at banks. The price runs the other way: factor rates of roughly 1.1 to 1.5 on an advance work out to APRs of 40% to 350%, against 15% to 45% for online term loans and 6% to 20% for bank loans. Equipment financing is often easier when the money buys an asset, and it usually costs less than unsecured products. SBA microloans accept startups, up to $50,000 at 8% to 13% per the SBA, but run through nonprofit intermediaries and take weeks.
What is the monthly payment on a $50,000 business loan?
A $50,000 business loan costs $761 a month over 10 years at 13.5% (the SBA 7(a) variable rate maximum as of September 2026), $1,062 over 5 years at 10%, or $2,796 over 2 years at 30%. These are examples, not offers: the lender sets the rate and term, and fees are extra. A longer term lowers the payment and raises the total interest at the same rate. The Business Loan Calculator: Monthly Payments and How Much You Can Borrow runs your own amount, rate and term.
Example payments on a $50,000 business loan
| Example only, not an offer, fees left out | Monthly payment | Total interest |
|---|---|---|
| 10 years at 13.5%, the SBA 7(a) variable rate maximum as of September 2026 | $761 | $41,365 |
| 5 years at 10%, an example bank loan rate | $1,062 | $13,741 |
| 2 years at 30%, an example online loan rate | $2,796 | $17,095 |
Can a startup LLC get a business loan?
Yes, with limits. Lenders weigh time in business, revenue and the owner's personal credit more than the LLC itself, and most ask for a personal guarantee, which makes you personally responsible if the business cannot repay. A few routes suit a young business. SBA microloans go up to $50,000 and set no minimum time in business. SBA 7(a) lists starting a business as an eligible use, though many lenders look for two or more years of trading. Equipment financing can also work, because the asset secures the loan. Can you get a business loan in your first year? shows what a first year business can reach.
What do small business owners actually ask for?
Just over half ask for $50,000 or less (51.7%), and more than half report monthly revenue under $10,000 (53.4%). The two overlap: 44.9% of requests above $50,000 come from businesses reporting under $10,000 a month, below the level many lenders look for. These are self-reported, unverified shares of businesses that applied through TopFunders.ai. They describe demand, not approvals or funding. The full method is in the TopFunders Small Business Funding Study.
Self-reported shares of applicants
| Figure | Share |
|---|---|
| Applicants who ask for $50,000 or less (self-reported, unverified) | 51.7% |
| Applicants who report monthly revenue under $10,000 (self-reported, unverified) | 53.4% |
| Applicants asking for more than $50,000 who report monthly revenue under $10,000 (self-reported, unverified) | 44.9% |
How long does it take to get a small business loan?
From 24 hours to 90 days, and the product you choose decides which end you land on. Merchant cash advances fund same day to 24 hours, online term loans in 24 to 48 hours, bank term loans in 2 to 4 weeks and SBA loans in 30 to 90 days. These are typical timelines for a complete file, not commitments. The fastest products usually cost the most, so weigh what speed costs against what waiting costs. How Long Does It Take to Get a Business Loan? compares every product.
How do you compare small business loan offers?
By total repayment in dollars, not by the rate.
- Ask for the total repayment in dollars, plus the cash you receive after fees. The difference is what the money costs.
- A factor rate is not an APR. A $50,000 advance at 1.35 repays $67,500, and over six to twelve months that works out to far more than 35% a year.
- Check prepayment terms. Paying a term loan early usually saves interest, while paying an advance early usually saves nothing, because the cost was fixed on day one.
What Business Financing Costs explains each cost measure, and How to compare business loan offers has a worked example.
Frequently asked questions
What is the easiest small business loan to get?
Merchant cash advances first, then online term lenders, because they publish the lowest minimums. They are the easiest to qualify for and usually cost the most.
What is the monthly payment on a $50,000 business loan?
A $50,000 business loan costs $761 a month over 10 years at 13.5% (the SBA 7(a) variable rate maximum as of September 2026), $1,062 over 5 years at 10%, or $2,796 over 2 years at 30%. Lenders set the real rate, and fees are extra.
Can a start-up LLC get a loan?
Yes, with limits. Lenders weigh time in business, revenue and the owner's personal credit more than the LLC itself, and most ask for a personal guarantee. SBA microloans set no minimum time in business, and equipment financing can work when the asset secures the loan.
What is needed to qualify for a small business loan?
Lenders check four things: monthly revenue, time in business, personal credit and cash flow. Published minimums commonly sit around a personal credit score of 625 to 660, 12 months in business and $100,000 in annual revenue.
How long does it take to get a small business loan?
From 24 hours to 90 days, depending on the product. Merchant cash advances fund same day to 24 hours, online term loans in 24 to 48 hours, bank term loans in 2 to 4 weeks and SBA loans in 30 to 90 days.
Do you need collateral for a small business loan?
Not always. An unsecured loan needs no collateral, though most lenders still ask for a personal guarantee. What Is an Unsecured Business Loan and Is It Right for You? explains the tradeoffs.
What credit score do you need for a small business loan?
It depends on the lender and the product. Published minimums run from about 550 for merchant cash advances to about 625 at online term lenders and 660 to 700 or higher at banks. The SBA publishes no minimum score for 7(a) loans. Can you get a business loan with bad credit? covers scores under 600.
Not sure which loan type fits your business?
Answer a few questions and see the lending partners ready to make your business an offer. Checking your options doesn't affect your credit. TopFunders.ai is not a lender and not a loan broker, and the partners you see depend on your answers.
See the lending partners ready to make your business an offer
TopFunders.ai is not a lender, not a loan broker, and does not originate, underwrite, price or fund loans. We make no credit decisions. A match is not an approval: each partner makes its own decision and sets any amount, rate and terms. Costs, speeds and amounts are typical ranges unless marked as published, and lenders change their terms. Minimum scores, time in business and revenue are as published by lenders and last checked September 24, 2026. Percentages from our applicant data are self-reported and describe demand, not approvals.
Sources
- SBA, microloan program
- SBA, 7(a) loan program
- Lender minimums: each lender's own website, read September 24, 2026 (named table in Business Loan Requirements by Lender (2026))