Best short-term business loans.
Small businesses in need of immediate financing can receive fast funding through short-term loans.
What is a short-term business loan?
How do short-term business loans work?
Types of short-term business loans.
Term loans – These are loans with a fixed repayment term and interest rate. They are typically used for specific projects or investments.
Lines of credit – This type of loan provides businesses with a revolving credit limit that can be accessed as needed. Interest is only charged on the amount borrowed.
Invoice factoring – This financing option involves selling accounts receivable to a third party at a discount. It provides immediate cash flow by converting unpaid invoices into working capital.
Business cash advances – This type of loan allows businesses to receive a lump sum payment in exchange for a percentage of future sales.
It is important for businesses to research and compare these different options before deciding on the best fit for their needs.
Best short-term business loans of 2024.
Funding Circle – Term loan
Kapitus – Revenue-based financing
OnDeck – Revenue-based financing
BlueVine – Line of credit
Raistone Capital – Invoice factoring
Minimum requirements for a short-term loan.
*Qualification criteria, rates, and other funding terms will vary depending on the type and location of your business, and upon other factors. This is not a guarantee of funding, and it should not be relied upon as an accurate assessment of the availability or terms of the represented funding products.
How much can I qualify for?
Not sure what you need or what funding options are best for you? Use our simple calculator to get a rough idea of your options with no commitment, and apply when you’re ready.
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FAQs
Find answers to some commonly asked questions about short-term business loans.
The term for these small business loans is right in the name: short-term. Short-term business loans typically have repayment terms of 18 months or less.
The interest rate for short-term business loans can vary depending on the lender, the borrower’s credit score, and the loan amount. Generally, interest rates for these loans tend to be higher than those of traditional long-term loans, due to their shorter term lengths.
Some short-term funding products will use a factor rate instead of an interest rate. Unlike interest rates which are expressed as a percentage of the principal loan amount, a factor rate is usually expressed as a decimal figure.
To calculate the total amount you will need to repay on a loan with a factor rate, you multiply the loan amount by the factor rate. For example, if you receive a $50,000 loan with a factor rate of 1.2, you would have to repay a total of $60,000 ($50,000 x 1.2).
If you’re in a bind and need a quick cash flow boost, some loans can provide you with cash in hand in as little as 24 hours after your application is approved. Having all of your application materials ready to go when applying can help speed the process along.
Yes, a startup business can potentially secure a short-term loan, although it can be more challenging than for established businesses due to the perceived risk. Lenders typically require a solid credit history, a detailed business plan, and sometimes personal collateral. Some lenders specialize in startup loans and may have more flexible criteria, but interest rates may be higher to offset the risk. It’s crucial for startups to carefully evaluate the terms of any loan and consider the impact on their business finances.
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