How much income do you need to get a business loan?

There is no universal minimum income requirement for a business loan, because every lender sets its own criteria. Some lenders will work with businesses generating tens of thousands of dollars in annual revenue, while many lenders may require $100,000 or more in annual revenue. Bank of America, for example, currently lists $100,000 in annual revenue for its unsecured term loan, and Fundbox lists $100,000 in annual revenue for its line of credit.

How do I get a business loan for the first time?

To get a business loan for the first time, start by checking your personal and business credit, determining how much you need, and finding lenders whose requirements you can meet. First-time borrowers should resist the temptation to apply everywhere at once. Understanding your qualifications before applying can help you avoid unnecessary hard credit inquiries and rejected applications.

What credit score is needed to get a business loan?

The credit score you need for a business loan depends on the lender and loan, but stronger personal credit generally gives you more options. Traditional bank loans may require good or excellent personal credit. Online lenders may accept scores in the 600s or lower for some products. For example, current published FICO score minimums include 700+ for Bank of America's unsecured term loan, 625 for OnDeck, and 600 for Fundbox.

How hard is it to get a business loan?

Getting a business loan can be relatively straightforward if you have strong credit, consistent revenue, and an established business. Still, it becomes more difficult when one or more of those factors are weak. The good news is that there are many types of business financing, so you don't have to qualify for every loan to find an option that works.

What bank is easiest to get a business loan from?

There isn't one bank that's easiest to get a business loan from, because approval depends on your credit, revenue, time in business, and the specific loan you're applying for. If you already have a relationship with a bank, it may be a sensible starting point. But compare its requirements and offers with those of other banks and online lenders before committing.

What are the types of business loans?

Common types of business financing include term loans, lines of credit, SBA loans, equipment financing, microloans, invoice financing, merchant cash advances, and business credit cards. Each type works differently, so the right option depends on what you're using the money for, how much you need, and how quickly you need it.

How do you know what type of financing is right for your business?

Choose business financing based on what you need the money for, how much you need, how quickly you need it, and what you can afford to repay. A term loan may make sense for a large one-time expense, while a line of credit can be useful when you need access to working capital over time.

What are lenders looking for?

Lenders generally look at your credit, time in business, revenue, cash flow, and ability to repay the debt. Depending on the lender and loan, they may also consider collateral, industry, existing debt, and your business credit history.

What are the requirements for a business loan?

Common business loan requirements include personal and business credit information, a minimum time in business, minimum revenue, bank statements, and other financial documents. The exact requirements vary widely. A traditional bank may ask for years of financial records. At the same time, an online lender may be able to evaluate your application using business bank account data and a smaller set of documents.

What is the easiest business loan to get approved for?

The business loan that’s easiest to get approved for is generally the option whose requirements best match your current financial profile. Online financing, business credit cards, invoice financing, and merchant cash advances may be more accessible to businesses that don't qualify for traditional loans. Still, easier approval can come with a higher cost.

Can you get a business loan with no revenue?

Getting a traditional business loan without revenue is difficult, but some startup financing options don't require established revenue. If your business hasn't generated revenue yet, lenders have less evidence that the business can repay the debt. Your personal credit, assets, business plan, and other sources of repayment may become more important. Depending on your situation, alternatives may include business credit cards, crowdfunding, equipment financing, or startup-focused financing.

How long does business loan approval take?

Business loan approval can take anywhere from minutes to several weeks or longer, depending on the lender and loan type. Online lenders can sometimes make decisions within hours, while traditional bank and SBA financing generally takes longer because the underwriting process is more extensive.

How do I check the status of a business loan?

To check the status of a business loan, contact the lender directly or check your online application portal to see whether your application is pending, approved, or requires additional documentation. If the lender requests more information, providing it promptly can help prevent unnecessary delays.

Resources Blog

How to get a business loan: Requirements, steps, and what lenders check

Written byJasmin Baron

Reviewed by Robin Saks Frankel

Updated September 7, 2026|18 min read

Summary

Getting a business loan starts with understanding what lenders look for.
The main factors are usually your credit, revenue, and time in business, but you’ll also want to choose the right type of financing and apply with lenders whose requirements you can actually meet.
The good news is that you don't need to be a lending expert to get started.
Let’s explore how to get a business loan, especially if you’ve never had one before.

Editorial disclosure: Our priority is to provide accurate, unbiased financial information for your business. Our partners cannot pay for favorable reviews. All content is accurate to the best of our knowledge when posted. You can review more details .

We also encourage you to review our .

Steps to get a business loan

If you're getting a first-time business loan, these six steps can help you avoid wasting time on applications you're unlikely to qualify for.

Understand what lenders look for: Your credit, revenue, cash flow, time in business, and sometimes collateral will all factor into a lender's decision.
Choose the right loan type: The best financing depends on what you're buying, how much you need, and how quickly you need it.
Check your approval odds before applying: Prequalification can help you see which options may be a good fit without immediately triggering a hard credit inquiry.
Gather your documents: Having financial statements, tax returns, and other required paperwork ready can make the application much easier.
Compare and choose a lender: Look beyond the advertised rate and consider fees, repayment terms, funding speed, and qualification requirements.
Complete the application: Submit accurate information and respond promptly if the lender asks for additional documentation.

Understand what lenders look for

Lenders want to know one basic thing: Can your business repay this debt?

To answer that question, they may look at your personal and business credit, how long you've been in business, your revenue and cash flow, available collateral, and even your industry. Traditional lenders such as banks and credit unions generally have more extensive documentation and underwriting requirements than online lenders.

Time in business

The longer you've been operating, the more financing options you may have. Many traditional lenders require at least two years in business. Some online loans require only six months or a year of operation, although other requirements may be higher. For example, Kapitus currently lists two years in business as a minimum, while Credibly lists six months.

If you're a brand-new business with little or no revenue, a traditional term loan or line of credit can be particularly difficult to get. Startup financing options may include business credit cards, equipment financing, microloans, crowdfunding, or financing based on the owner's personal credit.

Personal credit

Your personal credit score may be one of the most important pieces of your application, particularly if your business is new or doesn't have an established business credit history. A lender may use your personal credit history to evaluate how you've handled debt in the past.

Many business loans also require a personal guarantee, which means you could be personally responsible for repayment if your business doesn't pay the debt. In general, stronger personal credit gives you more financing choices and can help you qualify for better terms.

If you're not sure where you stand, check your personal credit before you start applying. You should also understand your business credit profile. Nav can help you keep track of both.

Business credit

Some lenders check business credit reports and scores as part of their underwriting process. They look for a history of paying business obligations on time as well as warning signs such as collections, judgments, liens, or an excessive number of UCC filings.

A good business credit score can help demonstrate that your company has handled its financial obligations responsibly.

Revenue and cash flow

Revenue tells a lender how much money your business brings in. Cash flow helps show whether you have enough money coming in to make your loan payments. But those aren't necessarily the same thing.

Think of it this way: A business can have substantial revenue and still struggle to repay debt if its expenses are high or its cash flow is unpredictable. That's why lenders may review several months of business bank account activity and financial statements rather than relying on revenue alone.

Collateral

Collateral is an asset that secures a loan. Depending on the financing, that could include real estate, equipment, vehicles, inventory, or other business assets. Some loans don't require specific collateral, but "unsecured" doesn't necessarily mean risk-free. A lender may still require a personal guarantee or file a UCC lien against business assets.

If you're considering an SBA 7(a) loan, don't assume you automatically need to own valuable property to qualify. SBA requirements vary by program and lender, and lack of collateral alone generally isn't supposed to be the sole reason an otherwise eligible 7(a) applicant is declined.

Business loan requirements by lender type

There isn't one set of business loan requirements that applies to every lender as each one has a different underwriting process. Here's a useful starting point:

Lender type	Typical personal credit	Time in business	Revenue	Collateral
Traditional bank	680+ is common; some products require 700+	Often 2+ years	$100,000+ is common for many products	May be required, depending on loan
Online lender	Often 600 to 625+ for more accessible products; varies widely	Often 6 to 12 months	Often $30,000 to $100,000+	Varies by lender and product
SBA lender	No universal minimum; lender sets its own criteria	Varies by lender and program	Varies	May be required depending on circumstances

Nav is not a lender or a credit bureau. Credit information is provided by third-party sources.

Note that these are representative ranges, not universal industry requirements. For example, Bank of America as of this writing lists a personal FICO score of 700 or higher, two years in business, and $100,000 in annual revenue for its unsecured term loan. In contrast, OnDeck lists a personal FICO score of 625, one year in business, and $100,000 in annual revenue.

Choose the right loan type

Before you apply, figure out what you actually need the money for. If you're buying equipment, for example, equipment financing may make more sense than a general-purpose term loan. If you need access to cash periodically rather than one large lump sum, a business line of credit may be a better fit.

Here are some of the most common options to consider along with typical financing costs:

Financing type	Typical amount	Typical APR/cost	Time to fund	Credit needed	Best for
SBA loans	Up to $5 million depending on program	11.5% - 15% APR	Weeks to months	Varies	Lower-cost, longer-term financing
Bank term loans	Varies; often $10,000+	5.5% - 12% APR	Weeks to months	Good to excellent	Major purchases, expansion
Online term loans	$5,000 to $500,000+	10% - 99% APR	Same day to several days	Varies	Businesses that need speed
Business lines of credit	$1,000 to $250,000+	7% - 36%+ APR, plus fees	Same day to several days	Varies	Working capital, recurring expenses
Microloans	Generally up to $50,000	8% - 13% APR	Weeks to months	Varies	Smaller funding needs, newer businesses
Equipment financing	Varies	4% - 40% APR	Days to weeks	Varies	Purchasing business equipment
Invoice financing/factoring	Varies	10% - 60% APR	Often days	Often based on customers’ credit	Businesses waiting on customer invoices
Merchant cash advances	Varies	40% - 150%+ effective APR	Often days	Often less important	Businesses with strong sales that need fast funding
Business credit cards	Varies by issuer and card	18% - 26% variable APR, after possible intro period	Often same day to several days	Personal credit usually matters	Short-term expenses, flexible access to capital

You don't necessarily need to understand every financing product before you apply. That's what comparison tools and marketplaces are for.

If you're considering cash-flow-based financing, see our guide to cash flow loans rather than trying to compare every option here.

Check your approval odds before applying

One of the easiest ways to get a business loan denied is to apply blindly. Many lenders and financing marketplaces offer some form of prequalification or prescreening. You provide basic information about your business and finances, and the lender estimates whether you may qualify and, in some cases, what rates or terms you might receive.

Prequalification generally uses a soft credit inquiry, or pull, while a formal application may trigger a hard inquiry. That means you can often shop around before deciding where to submit a full application.

What’s the main difference between a soft pull vs. hard pull? A soft inquiry doesn't affect your credit score in the same way a hard inquiry can. Still, check the lender's terms before proceeding because the exact process varies.

Gather required documents

The exact paperwork depends on the lender and loan, but it's smart to have the following ready:

Business and personal tax returns
Business bank statements
Profit and loss statements
Balance sheet
Business licenses and registrations
Business formation documents
EIN confirmation
Personal identification
Accounts receivable or unpaid invoice information, if applicable
Information about existing business debt
Commercial lease or other relevant contracts
Business plan and financial projections, particularly for larger or more traditional loans
Documentation for collateral, if the loan is secured

You might not need every item on this list. An online lender may ask for only a few months of bank statements and basic business information, while a bank or SBA lender may request a much larger package. The easiest way to make this part less painful is to gather your records before you start the application.

Compare and choose a lender

Once you know what you qualify for and what kind of financing you need, compare several lenders rather than automatically accepting the first offer.

Look at the total cost of the financing, not just the advertised interest rate. Check the repayment schedule, fees, prepayment terms, personal guarantee requirements, and whether the lender will place a UCC lien.

Speed matters, too. For example, if you need $20,000 next week to purchase inventory, a bank loan that takes two months to close isn't necessarily a better deal than a faster option, even if the bank's rate is lower.

On the other hand, if you're financing a major expansion and can wait, paying substantially more for speed may defeat the purpose.

Complete the application

When you're ready to apply, complete the application carefully and make sure the information matches your financial documents.

Common mistakes include:

Reporting revenue that doesn't match your tax returns or bank statements
Leaving out existing business debt
Using inconsistent business names or addresses
Failing to disclose liens or other financing
Applying for more than you can reasonably afford to repay
Applying for a loan product that doesn't match your business's qualifications
Submitting incomplete documentation
Ignoring requests for additional information

If a lender asks for another document, don't let the application sit in your inbox for a week. Delays can slow down underwriting and funding.

Business loan requirements by lender type

Most traditional bank borrowers should expect to need strong personal credit, at least two years in business, and meaningful annual revenue. If you’re getting a business loan with bad credit, online lenders may accept lower credit scores, shorter operating histories, and lower revenue.

For example, Bank of America's current published requirements for its unsecured Business Advantage Term Loan include a personal FICO score above 700, two years in business, and at least $100,000 in annual revenue. Its cash-secured line of credit has lower entry requirements: six months in business, $50,000 in annualized revenue, and a refundable $1,000 security deposit.

Online lenders can be considerably more flexible. OnDeck as of this writing lists a 625 personal FICO score, one year in business, and $100,000 in annual revenue as minimum requirements.

If you’re worried about how to qualify for a business loan, note that meeting the minimum doesn't guarantee approval. Lenders may consider additional factors, including cash flow, industry, existing debt, and business credit.

Apply now

Term Loan by OnDeck

This is a great option for businesses with consistent revenue, seeking competitive pricing working capital products. OD is known in the industry for their transparency and speed to fund. OD is the largest online lending company, which provides confidence to users with finding the right long-term partner to help fuel their company's growth.

Pros

Predictable daily or weekly payments to support cash flow planning
When you prepay early in full, some or all remaining unpaid interest is waived depending on your loan agreement‡
If you need additional capital, On Deck makes applying for a renewal easy.

Cons

Need a minimum of 6 months time in business
Not available in all states.

Funding Amount

$5,000 - $400,000

Cost

As low as 29.9% APR

Repayment Terms

N/A

Funding Speed

48 hours

Bank requirements

Banks generally offer some of the more competitive rates, but you'll usually need a well-established business and strong financials to qualify. Many banks look for:

Good to excellent personal credit
At least two years in business
Consistent revenue and positive cash flow
A business bank account
A strong business credit history, when available
Financial statements and tax returns
Collateral or a personal guarantee, depending on the loan

Online lender requirements

Online lenders typically emphasize faster funding and sometimes use more flexible underwriting models. Requirements vary, but some lenders will work with businesses that have been operating for only six to 12 months or have personal credit scores in the low- to mid-600s.

The trade-off is that easier qualification and faster funding can lead to higher borrowing costs.

SBA loan requirements

Participating lenders make SBA loans, so requirements aren't identical across all lenders or SBA financing programs.

The SBA generally requires an eligible business to meet program-specific standards, while the lender evaluates the owner's creditworthiness, ability to repay, and other factors.

How to get a business loan with bad credit

You can get business financing with bad credit, but your options may be more limited and more expensive. Start by identifying which part of your credit profile is creating the problem. A lender may be looking at your personal credit, business credit, or both.

Here's a rough way to think about your options:

Excellent/good credit (generally 680+ FICO score): You may qualify for traditional bank loans, SBA-backed financing, competitive online loans, and business lines of credit.
Fair credit (roughly 600 to 679 FICO score): Online lenders, business credit cards, and some lines of credit may be more accessible than traditional bank loans.
Poor credit (FICO score below 600): Traditional loans may be difficult to obtain. Depending on your business's revenue and other qualifications, you may still have options such as certain online financing, invoice financing, merchant cash advances, or secured financing.

Credit score requirements vary widely by lender and product, so these tiers are general guidance rather than guarantees. For example, current online lender FICO score requirements range from 600 at Fundbox to 625 at OnDeck.

If your credit is keeping you from getting affordable financing, don't automatically take the most expensive option available. Improving your credit, building business credit and increasing consistent revenue can open up better choices later.

Apply now

Line of Credit by Fundbox

Nav recommends this product as a great solution for newer small businesses looking for a fast application process and access to a flexible LOC product. Bonus: When you click 'Apply now," we'll securely pass over your info, making applying with Fundbox a breeze. Only answer a few additional questions on their end and you're good to go.

Pros

600 minimum personal credit score
No impact to credit score to apply (soft pull only)
No draw fees
Fast approval and funding, with funds available as soon as the next business day
Use as much as you need, only pay interest on what you use
Fundbox reports payment activity to all the major commercial credit bureaus via the Small Business Financial Exchange (SBFE), which can help strengthen a business's credit profile.

Cons

Must have a business checking account with a minimum balance of $500
Each draw functions as its own loan; additional draws do not modify or consolidate existing balances.

Funding Amount

$1,000 - $250,000

Cost

As low as 4.99%*

Repayment Terms

Up to 76 weeks

Funding Speed

If approved, funds arrive as soon as the next business day.

What a business loan really costs

The interest rate isn't necessarily the whole cost of borrowing. When comparing financing options, look at the total cost, including interest, origination fees, factor charges, and other fees. Also consider how frequently you'll have to make payments.

APR vs. factor rate

APR and factor rates aren't interchangeable. Here’s how they compare.

	APR	Factor rate
Commonly used with	Traditional and many online loans	Merchant cash advances and some short-term financing
How it’s expressed	Percentage	Decimal
What it tells you	Annualized borrowing cost	Total repayment relative to the amount borrowed
Example	20% APR	1.20 factor rate

With a factor rate, multiply the amount borrowed by the factor rate to estimate total repayment.

For example, if you borrow $20,000 at a 1.20 factor rate:

$20,000 × 1.20 = $24,000 total repayment

Your financing cost is $4,000 ($24,000 - $20,000).

The repayment schedule matters, too. A financing product that requires daily or weekly payments can put more pressure on your business's cash flow than a loan with monthly payments, even if the total cost looks manageable.

Before accepting an offer, make sure you know exactly how much you'll repay, how often you'll make payments, and what happens if you pay the financing off early.

What to do if your business loan is denied

If your business loan is denied, find out why, address the specific problem, and then look for lenders whose requirements better match your business. A denial isn't necessarily a verdict on your business. It may simply mean you applied for the wrong product or lender at the wrong time.

Common reasons for denial include:

Low personal or business credit scores
Insufficient time in business
Revenue that's too low or inconsistent
Weak cash flow
Too much existing debt
Insufficient collateral
An industry the lender doesn't serve
Problems on your credit report
Incomplete or inconsistent application information

Start by asking the lender why you weren't approved. If the problem is credit, work on improving it before applying again. If it's revenue or time in business, you may simply need to wait until your financial profile is stronger.

If a bank says no, that doesn't mean every lender will. Online lenders can have more flexible requirements, although they may charge more. Other options may include:

The goal isn't simply to find someone willing to lend you money. You want to find financing your business can realistically afford to repay.

How to get a business loan from a bank

Knowing how to get a small business loan from a bank is a smart starting point. These loans work best if you have strong credit, at least two years of business history, consistent revenue, and solid financial records.

It’s best to start with the bank where you already have a business relationship, then compare its offer with other banks and lenders. Be prepared for a longer application and underwriting process. Banks may request tax returns, financial statements, bank statements, business plans, and collateral information.

If you don't meet a bank's requirements, don't keep submitting applications to banks that use similar criteria. Consider an online lender or other financing option instead.

How to get a loan to buy a business

You can finance a business acquisition, but lenders will usually want detailed information about both the business you're buying and your ability to repay the loan. Expect to provide financial statements and tax returns for the business, information about the purchase price and transaction, and your own financial and credit information.

An SBA-backed loan may be an option for qualifying acquisitions, although eligibility and underwriting requirements apply. You'll also want to make sure the business's existing cash flow can support the proposed debt payments. Don't assume that because a business is profitable, it can automatically support the loan you're considering.

How to get a business loan with no money

As for how to apply for a business loan with no money, you may be able to get business financing without putting down a large amount of your own cash. But true no-money-down financing isn’t available for every business or loan type.

Some unsecured loans don't require a down payment or specific collateral. Others may require a personal guarantee, a UCC lien, or some other form of security. If you're buying equipment, for example, equipment financing may allow the equipment itself to serve as collateral. A lender may still require you to contribute some money toward the purchase.

If you have little cash, focus on financing options that match the assets, revenue, or credit you already have rather than searching for a loan that requires absolutely nothing from you.

How to get a business loan without collateral

You can get some business loans without specific collateral, but lenders may compensate for the additional risk in other ways. Unsecured financing may require stronger credit, higher revenue, a personal guarantee, or a UCC lien against business assets.

Some online lenders offer unsecured business loans and lines of credit. Banks also offer unsecured products to highly qualified borrowers. For example, Bank of America currently offers unsecured term loans and unsecured lines of credit. However, both require strong credit, two years in business, and $100,000 in annual revenue.

If you're having trouble qualifying for unsecured financing, secured financing may give you more options. But it’s important to understand exactly what assets are at risk if you can't repay.

Frequently asked questions

The bottom line

Getting a business loan doesn't have to mean filling out multiple applications and hoping someone says yes. Start by understanding your credit, revenue, cash flow, and time in business. Then choose a financing option that fits your needs and look for lenders whose requirements match your qualifications.

Most importantly, don't focus only on getting approved. Make sure you understand what the financing will cost and whether your business can comfortably handle the payments.

Nav can help you compare financing options based on your business and qualifications, so you can spend less time applying for loans you're unlikely to get and more time finding financing that actually fits your business.

Add as a preferred source on Google

Rate this article

This article currently has 92 ratings with an average of 5 stars.

Jasmin Baron
Contributor
All articles
Jasmin Baron is a NACCC Certified Credit Counselor™ and personal finance expert with more than 12 years of experience writing and editing credit-focused content. She specializes in credit education, credit building, credit management, and credit cards, with a strong emphasis on helping entrepreneurs and small-business owners make informed financial decisions. As a sole proprietor herself, Jasmin understands firsthand the opportunities and challenges that come with building and sustaining a business, and she is passionate about equipping fellow business owners with practical, actionable financial guidance.
Jasmin holds a Bachelor of Science degree from McMaster University and an Aviation and Flight Technology Diploma from Seneca Polytechnic. Her background as an adult educator — including nearly two decades of experience teaching at the college level — shapes her clear, approachable writing style and her commitment to making complex financial topics accessible. While her early career included work in the aviation industry, she now focuses primarily on personal finance and credit education, helping readers build strong credit profiles and use financial tools strategically.
Her work has appeared on outlets such as CNN Underscored Money, Business Insider, The Points Guy, point.me, and CardCritics. When she’s not writing about credit and small-business finance, Jasmin enjoys spending time with her three kids and her dog, Benji.
All articles
Reviewed by
Robin Saks Frankel
Managing Editor
All articles
Robin has worked as a personal finance writer, editor, and spokesperson for over a decade. Her work has appeared in national publications including Forbes Advisor, USA TODAY, NerdWallet, Bankrate, the Associated Press, and more. She has appeared on or contributed to The New York Times, Fox News, CBS Radio, ABC Radio, NPR, International Business Times and NBC, ABC, and CBS TV affiliates nationwide.

Robin holds an M.S. in Business and Economic Journalism from Boston University and dual B.A. degrees in Economics and International Relations from Boston University. In addition, she is an accredited CEPF® and holds an ACES certificate in Editing from the Poynter Institute.
All articles