Disclaimer: Information in the term loan articles is provided for general information only, does not constitute financial advice, and does not necessarily describe Biz2Credit commercial financing products. In fact, information in the term loan articles often covers financial products that Biz2Credit does not currently offer.

At one point or another, most companies will need a quick infusion of cash. Reasons vary: trucks get into accidents, equipment breaks and must be fixed or replaced, or you have had a few slow weeks after the holidays and you need to make payroll on Friday.

Conversely, in the best-case scenario, a new project requires an immediate ramp-up but payment won’t occur for a few months. Whatever the case is, sometimes a company needs to know the easiest business loan to get on short notice.

Fortunately, there are many types of funding for businesses, including several that offer very fast funding.

In this article:

• Understand the difference between fast funding and slower funding loan products
• Explore the easiest business loans to get, whether you’re a startup or a more established business
• Understand eligibility requirements for different financing options, including minimum credit score, annual revenue, and time in business

The Difference Between Fast Funding and Slow Funding

In small business financing, there can be a significant time difference between fast funding and slow funding. However, it’s a bit more complex than that

Traditional small business loans and U.S. Small Business Administration (SBA) loans, which are the most affordable for those who have good credit, typically take weeks to process. The application process is more rigorous and borrowers must provide more financial and bank statements and meet stricter qualifying standards. The underwriting process with traditional banks and other business lenders may take several weeks.

The easiest business loans to get are also usually the fastest to get. Sometimes, small business owners with good credit and a strong loan application can get same day funding. Entrepreneurs are still usually subject to credit score requirements and other eligibility requirements. Nonetheless, the online application process with online lenders and other alternative lenders may take just a few minutes, and usually you’ll be able to get funding quickly.

Remember that even with the easiest business loans to get, you may still have to provide a personal guarantee or put up collateral to avoid higher interest rates. This puts your personal finances at risk if you default on the loan.

Three of the Easiest Business Loans to Get

The business loan interest rate average is usually higher for these types of funding for businesses. That said, each is a useful business loan option for new businesses, businesses that need cash fast, and business owners with bad personal credit or limited credit history.

Working Capital Loans

Working capital loans enable businesses to cover operating expenses or pounce quickly upon business opportunities. Available from both traditional lenders and alternative lenders, the terms of these loans are relatively short-term, often between three months and 18 months. The typical business loan interest rates vary; sometimes working capital loans can be at 7 to 8 percent, but other lenders may charge 30 percent or more.

Working capital loan programs are predicated on fast funding because the businesses that need them are often in urgent need of increased cash flow. They usually have a streamlined application process and are among the best small business loans for seasonal businesses or contract-based businesses that often experience delays in accounts receivable.

To qualify for these short-term loans, you’ll usually need a relatively strong personal credit score or business credit score, and be able to provide financial statements or business plan that prove your business is or will soon be profitable. Nonetheless, they can be some of the easiest business loans to get.

Business Lines of Credit

If you have more time to ramp up, a business line of credit can be a good solution. A business line of credit is part loan and part business credit card. A lender approves you for a maximum credit line, which you can debit into your business bank account. Rather than pay interest on the whole loan amount, you only pay interest on the amounts you use.

Business lines of credit don’t subject you to fixed monthly payments like a loan does; it gives you the flexibility to borrow when you need money for various business needs and pay it back, plus interest, within the loan term.

Like any other loan type, funding is subject to a credit check, but the time in business and annual revenue requirements tend to be lower than traditional small business loans. As such, it’s a good option for startup businesses that haven’t quite started generating significant revenues. In fact, the Federal Reserve Banks’ 2023 Small Business Credit Survey found that 43% of businesses that applied for financing chose a business line of credit.

Merchant Cash Advance

A merchant cash advance (MCA) can be the solution for someone who needs an immediate lump sum of money. Cash advance companies provide an infusion of capital in return for a percentage of your future credit card receipts and other business receipts. Among the easiest business loans to get, MCAs offer low qualification requirements and fast funding.

MCA providers may be be ccreditworthiness than traditional lenders because in this arrangement, they’re taking a percentage of future sales. While most loan offers come with fixed monthly payments, MCA repayment works off of a factor rate, usually between 1.1 and 1.5.

This means that to determine the final amount your business pays back, you must multiply the loan principal by the factor rate. So, for a $15,000 loan with a 1.3 factor rate, you’d owe 15,000 x 1.3, or $19,500.

This number may end up being higher than the business loan interest rate average, and the repayment time completely depends on your business's performance. If it booms, the amount gets paid back quickly. If you are stalling, the payment time drags out substantially. MCAs can be more expensive than other alternative business funding methods.

Likewise, repayment terms for MCAs tend to take daily or weekly percentages of your credit card receipts or other accounts receivable.

MCAs can be great resources for new businesses that expect to turn a profit quickly or established businesses in an emergency. Just remember to read the fine print because, like some other types of business loans, they may have prepayment penalties and other terms.

Conclusion

If speed is of the essence for funding your company, be sure you understand the higher costs that are usually involved. Fast funding is usually the most expensive, although they can be the easiest business loans to get for startups and business owners with bad credit.

FAQs

What is the easiest business loan to get?

The easiest business loan to get depends on your business and financial profile, but usually working capital loans, business lines of credit, and merchant cash advances (MCAs) are the best types of financing when you need cash fast.

What types of funding for businesses have the highest interest rates?

Usually, short-term financing options have the highest interest rates. For instance, business lines of credit or short-term equipment financing often have higher interest rates than longer-term loans like SBA loans or commercial real estate loans.

What’s the best business loan for entrepreneurs with bad credit?

The types of financing with the lowest eligibility requirements include business cash advances like MCAs or invoice factoring and business lines of credit.

What’s the typical business loan interest rate?

There really isn’t a typical business loan interest rate. It depends on the type of loan, the borrower’s creditworthiness, the business’s financial profile, and multiple other factors. That said, usually business loans with longer repayment terms have lower interest rates.

What is the fastest funding available for small businesses?

Funding speeds depend on the lender, the loan type, the borrower’s application, and more factors.

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