Yes, it’s possible to borrow money without collateral using an unsecured business loan. But be aware that these loans often come with stricter eligibility criteria and higher interest rates than business loans that are backed by an asset.
Up to $50,000
Undisclosed
Up to 48 months
U.S. Bank’s Unsecured Quick Loan offers same-day funding, making them our top choice for an unsecured loan for business owners who need money quickly.
The company offers short-term business loans up to $50,000 with the option to receive same-day funding and pay it back over up to 48 months. Plus, since it has a shorter time in business requirement, it may be a good fit for newer businesses as well.
One drawback is that the bank’s website lacks details on the specifics of this loan, including whether there is a minimum credit score or annual revenue requirement.
Read our full U.S. Bank small business loan review.
In order to qualify, you’ll need to meet U.S. Bank‘s criteria of:
Up to $250,000
7.80%
6 or 12 months
If you’re looking for flexible access to funding at an affordable price, consider Bluevine’s business line of credit, which offers one of the lowest starting interest rates on this list. Like business credit cards, lines of credit allow you to borrow money on an as-needed basis and replenish the funds upon repayment.
That said, Bluevine’s line of credit is likely only going to be an option if your business is well established. Its annual revenue requirement of $120,000 per year may be hard for newer businesses to reach. In addition, its 12-month time in business requirement excludes startups.
Plus, the fact that Bluevine’s rates start low doesn’t mean that’s the rate your business will qualify for — consider getting several quotes for your business so you can compare offers before choosing a loan.
Read our full Bluevine business line of credit review.
In order to qualify, you’ll need to meet Bluevine‘s criteria of:
$5,000 to $500,000
1.11 factor rate
4 to 24 months
With a funding cap of $500,000, National Funding is our top pick for businesses seeking large loans, offering higher loan amounts than most of the lenders on this list. Plus, National Funding doesn’t consider credit scores in its loan decisions, instead basing approval on a company’s time in business and annual gross sales. This helps make funding accessible to a greater number of businesses.
On the other hand, the repayment terms only extend to 24 months, which is shorter than many short-term business loan lenders. Not to mention the fact that the $250,000 annual revenue requirement can be hard for many small businesses to reach, and the lender requires you to sign a personal guarantee.
Read our full National Funding business loan review.
In order to qualify, you’ll need to meet National Funding‘s criteria of:
Up to $150,000
4.66% to 8.99%
4.66% for 12-week terms
8.99% for 24-week terms
3 or 6 months 12 or 24 weeks
Startups who are looking for unsecured business funding may want to turn to the line of credit through Fundbox. Its minimum credit score requirement, annual revenue requirement and time in business requirement are all more lenient than you might see with other lenders, making it a good fit for businesses that are just getting started.
But there are some tradeoffs to these flexible qualifying standards. At just $150,000, the borrowing cap is lower than you might find elsewhere. Also, Fundbox’s line of credit is the only financing product it offers, which can be limiting for business owners seeking a lump sum of cash.
Read our complete Fundbox business loan review.
In order to qualify, you’ll need to meet Fundbox‘s criteria of:
Up to $1,500,000
1.15 factor rate Factor rates start at 1.15, but can go as low as 1.10 with early payback provisions
Up to 18 months
Borrowers with bad credit may want to explore Fora Financial, as the lender accepts scores as low as 570 — by far the lowest credit requirement on this list. In addition, it offers the ability to borrow large loan amounts with its funding cap extending to $1,500,000, meaning that you should be able to use a Fora Financial loan to fund just about any business expense.
However, you’ll likely pay more in interest charges, especially if you have a lower credit score. As a rule of thumb, whenever interest is expressed as a factor rate, the rates tend to be higher. There are exceptions to this, but you’ll want to make sure you understand the full cost of the loan before agreeing to anything. Plus, you’ll be subject to a relatively short repayment term when paying back the amount that you’ve borrowed.
Read our complete Fora Financial business loan review.
In order to qualify, you’ll need to meet Fora Financial‘s criteria of:
$10,000 to $150,000
9.25% Based on the current prime rate of 7.50% plus 1.75% added by Wells Fargo
Revolving
If you’re not a fan of online lenders and you would rather get your financing from a traditional bank, consider Wells Fargo Bank’s BusinessLine® line of credit. This lender offers unique perks for borrowers, like a points-based rewards program (similar to credit cards rewards) and no foreign transaction fees. Plus, it offers options for both established businesses and startups. Their startup option, the Small Business Advantage® line of credit, has a max loan amount of $50,000 and slightly higher interest rates.
At the same time, though, Wells Fargo Bank is not fully transparent about its eligibility requirements, which can make it hard to tell if you’ll qualify for financing. Plus, this line of credit comes with fees and requires a personal guarantee.
Read our full Wells Fargo Bank business loan review.
In order to qualify, you’ll need to meet Wells Fargo Bank‘s criteria of:
$50,000
Undisclosed
12 to 24 months
Borrowers who struggle to meet the annual revenue requirement with other lenders may be better served by Headway Capital, which only requires businesses to make $50,000 in annual revenue to qualify — a lower requirement than most lenders. What’s more, this lender provides the option to pick between a weekly or monthly repayment schedule, providing added flexibility.
But there are some drawbacks to this lender. First and foremost, the borrowing cap on its unsecured line of credit is fairly low, extending to only $50,000. In addition, Headway Capital is not very transparent about all of its eligibility requirements and rate information, which makes it hard to tell if they’re a fit for your business without applying.
Read our entire Headway Capital business loan review.
In order to qualify, you’ll need to meet Headway Capital‘s criteria of:
$5,000 to $250,000
8.49%
12 to 60 months
Accion Opportunity Fund is our top choice for minority business owners because of both its mission and benefits.
It’s a nonprofit lender that focuses on addressing racial and gender inequalities by providing financing to minority business owners who have had trouble getting loans from traditional lenders. It combines flexible loan terms with perks like one-on-one business coaching and resources in both English and Spanish. Plus, it offers relatively low starting interest rates.
Accion Opportunity Fund does not disclose a minimum credit score requirement. However, the website does state that it looks at many factors beyond credit score when weighing loan approval decisions.
In order to qualify, you’ll need to meet Accion Opportunity Fund‘s criteria of:
$20,000 to $100,000
Undisclosed
24 to 60 months
PNC Bank’s small business loan is our top choice for businesses located in low-income communities because it offers 1.00% off its standard rates for businesses located in low- and moderate-income areas. That can be a significant difference — but it’s still a good idea to compare several quotes before signing up to check if that discounted rate makes them the cheapest option for your business.
PNC Bank loan amounts start at $20,000, making it an option for small businesses that need a smaller loan.
PNC Bank doesn’t disclose a minimum credit score for its small business loans. However, it does state that a personal credit history of five or more years that shows on-time payments on various types of debt is desired.
Read our full PNC Bank small business loan review.
In order to qualify, you’ll need to meet PNC‘s criteria of:
25+ years in business. 110+ million Americans served. $260+ billion in funded loans.
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To apply for a business loan:
1. Determine your borrowing needs: Go over your budget to determine what amount you need and whether you can afford repayments. You can use our business loan calculator to get a better sense of how borrowing various loan amounts will affect your budget.
2. Evaluate your qualifications: Once you decide what you can afford, you will also need to consider what you can qualify for and what the business loan requirements are. Typically, lenders look at your annual revenue and how long you’ve been in business. Lenders will also look at your personal and business credit score when determining rates and eligibility.
3. Compare lenders: It’s always a good idea to compare lenders to help find the best rate and the least amount of fees for your unsecured business loan. You can do so by reading reviews, visiting lenders’ websites and asking peers in your industry for recommendations.
4. Submit an application: Once you have found the lender that’s the best fit for you, it’s time to apply for a business loan. Applications can usually be done online, but lenders may ask for supporting documentation, such as a business plan or business tax returns.
| Pros | Cons |
|---|---|
| Collateral is not required. The application process is usually fairly simple. There are a wide variety of loan options, including choices for startups and bad credit borrowers. | Interest rates may be higher than secured loans. A personal guarantee is usually required. Approval often is based largely on the strength of your credit score. |
Yes, it’s possible to borrow money without collateral using an unsecured business loan. But be aware that these loans often come with stricter eligibility criteria and higher interest rates than business loans that are backed by an asset.
To qualify for an unsecured business loan, your business will generally need to have sufficient revenue and longevity. You may also need a strong personal FICO score and to provide a personal guarantee.
Every lender’s minimum credit score requirements are different. Typically, a score of 670 and above is considered a good credit score and will be sufficient enough to get you approved for most loans. Meanwhile, a score of 740 or above is considered very good or excellent and is more likely to get you access to the most affordable interest rates.