Best Startup Business Loans

Short-term lenders and merchant cash advance providers quote a factor rate — borrow $100,000 at 1.25 and repay $125,000. That looks like 25%, but if you repay it over six months rather than a year the true annual cost is far higher, often above 60% APR, because you never have the full sum for the full year. Always convert to APR before comparing. A lender that refuses to state an APR is telling you it is high.

Most online lenders want six months to two years in business, $100,000 to $250,000 in annual revenue and a personal credit score of 600 or better. SBA loans ask for more paperwork and a stronger profile but carry far lower rates. Under six months in business, almost nothing here will lend to you; a business credit card or a personal loan is usually the realistic route.

Usually yes if you can wait. SBA 7(a) rates are capped relative to the prime rate and run far below online lenders, with terms up to 10 years for working capital and 25 for property. The trade is weeks rather than days, and a document pack most owners find tedious. On $100,000 the interest difference over the term is commonly tens of thousands of dollars.

We take each lender's published rates, fees and eligibility, and convert every offer to an APR on an identical $100,000 over 24 months including origination and draw fees. We record the stated minimum credit score, revenue and time in business, walk the public application to the point of a credit pull, and note whether rates are visible before applying and whether a personal guarantee or blanket lien is required.