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Best Of

4 Best LLC Business Loans of September 2021

LLCs can qualify for many types of business loans, provided they meet a lender’s requirements.

Marianne HayesJune 9, 2021
Many or all of the products featured here are from our partners who compensate us. This may influence which products we write about and where and how the product appears on a page. However, this does not influence our evaluations. Our opinions are our own. Here is a list of our partners and here's how we make money.

If you operate a limited liability company, a variety of LLC business loans can offer the capital you need. The best choice will depend on your business’s needs, as well as factors like your credit score, if you have collateral, how long your LLC’s been in business and its annual revenue.

Here are our picks for LLC business loans, as well as information LLC operators should know about when getting business financing.

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Our pick for

LLCs that can wait for funding

SBA loans have low interest rates, long repayment terms and high borrowing maximums. But getting approved and receiving funding can take a while.

SBA 7(a) loan

Est. APR

5.50 - 8.00%

Min. Credit Score

650

7(a) program participants include specialized lenders like Live Oak Bank and big-name traditional banks like Wells Fargo.

Pros

  • Available as a term loan or line of credit.
  • Interest rates are capped.
  • Long repayment terms available.

Cons

  • Personal guarantee is required.
  • Collateral is typically required.
  • Longer processing times than online lenders.
Learn more

Qualifications:

  • Be a for-profit U.S. business.
  • Must first use alternative financial resources, including personal assets.
  • Financial qualifications determined by individual lender.

Our pick for

LLCs looking to expand

Term loans provide a lump sum of money you can use for all kinds of needs, like securing office space or buying the equipment your LLC needs to grow.

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Credibility Capital - Online term loan

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Est. APR

6.99 - 24.99%

Depending on your creditworthiness and your business's financials

Min. Credit Score

650

Credibility Capital offers low-cost business loans that work best for small-business owners with strong credit.

Pros

  • Competitive rates among online lenders.
  • No prepayment penalty.
  • Extra monthly payments can save interest cost.

Cons

  • Requires high minimum credit score and revenue.
  • Requires business lien and may require personal guarantee.
  • Not available in Nevada, North Dakota, South Dakota or Vermont.
Read full review

Qualifications:

  • Minimum credit score: 650.
  • Minimum time in business: 2 years.
  • Minimum annual revenue: $200,000.
  • No bankruptcies in the past 5 years.

Our pick for

Short-term financing for LLCs

A business line of credit can help you manage your LLC's cash flow or cover an unexpected expense. Plus, you may be able to qualify with a lower credit score.

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OnDeck - Line of credit

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Est. APR

11.00 - 61.90%

Depending on your creditworthiness and your business's financials

Min. Credit Score

600

OnDeck offers a fast line of credit for small-business owners with less-than-stellar credit who need to manage cash flow or buy inventory.

Pros

  • Cash can be available within the same business day.
  • Requires low minimum credit score.
  • Less paperwork than most lenders.

Cons

  • Fixed-fee structure means early repayment will not save interest.
  • Requires weekly repayments.
  • Requires personal guarantee.
Read full review

Qualifications:

  • Minimum credit score: 600.
  • Minimum time in business: 1 year.
  • Minimum annual revenue: $100,000.
  • No bankruptcies in the past 2 years.

Our pick for

LLCs with unpaid customer invoices

If you run a B2B business, you can turn any unpaid invoices into fast cash by using a factoring company.

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BlueVine - Invoice factoring

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Est. APR

15.00 - 68.00%

Depending on your creditworthiness and your business's financials

Min. Credit Score

530

BlueVine's invoice factoring can turn unpaid customer invoices into fast cash.

Pros

  • Finances larger invoices.
  • Cash can be available within the same day.
  • Accepts low minimum credit score and short time in business.

Cons

  • Not for businesses that do not invoice on net terms.
  • Loan amount is tied to the value of your invoices.
  • Dependency on customers to pay their bills on time.
Read full review

Qualifications:

  • Minimum credit score: 530.
  • Minimum time in business: 3 months.
  • Minimum annual revenue: $120,000.

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Can you get a business loan with an LLC?

With small-business loans, lenders tend to care more about your business’s performance than its structure. That means you should be able to get a business loan as an LLC — provided you meet the lender’s requirements.

Specific qualifications will depend on the lender and the type of LLC business loan you’re seeking. But to get a business loan, you’ll typically need the following:

  • Good credit. You’ll likely need a FICO credit score of at least 690 to qualify for business loans with the lowest interest rate. Bad credit business loans may be available if your personal credit is spotty but your business is strong.
  • Some time in business. Banks and the SBA usually won’t fund businesses that haven’t been around for at least two years. Online lenders offer more flexibility to newer LLCs. For example, OnDeck’s line of credit requires a year in business, while BlueVine’s invoice factoring is available to businesses that have been around for three months.
  • Strong revenue. Lenders typically require a minimum annual revenue, which may range from $50,000 to $250,000. If your LLC can’t meet such a threshold, you may need to opt for financing options that rely on your personal credit, like a personal loan for business or business credit card.

While you may have chosen an LLC to limit your personal liability, many business loans may also require you to provide collateral or a personal guarantee. If it’s the latter, you’ll be held personally responsible for repaying the loan if the business is unable to do so.

Types of LLC business loans

There are many types of business loan options that might make sense for an LLC include:

  • SBA loans. SBA loans for LLCs take many forms. The SBA 7(a) loan is perhaps the most well-known as it provides working capital and can also fund equipment purchases and expansion. Meanwhile, an SBA 504 loan is reserved for businesses that need to buy long-term, fixed assets such as facilities or machinery. One downside is that getting approved and receiving funding can take a while. However, SBA Express loans offer faster funding, but smaller loan amounts — up to $1 million instead of up to $5.5 million.
  • Term loans. These loans are lump sums of money that you repay monthly (with interest) over a fixed repayment timeline. Eligible business owners can typically borrow anywhere from $2,000 to $5 million with a small-business term loan. Funding generally comes through quickly, sometimes in a matter of days, if you go through an online lender. But their loans will also likely be more expensive than SBA options or from a traditional bank.
  • Business lines of credit. A business line of credit can be a flexible alternative to a traditional business loan. Instead of a lump sum of money, business owners receive a credit line that they can draw on as needed. This typically ranges from $1,000 to $250,000. You’ll pay interest on the amount you borrow only, and smaller credit lines may not require collateral. You may also be able to qualify with a lower credit score.
  • Invoice factoring. This type of business financing leverages unpaid invoices to cover short-term needs. The business owner sells their outstanding invoices to a factoring company for a reduced price — discounts often range from 1% to 5% — in return for upfront cash. Invoice factoring is ideal for businesses whose customers are other businesses.

How to get a business loan for an LLC

  • Check your credit scores. Knowing your personal and business credit scores can give you a solid idea of the types of financing that will likely be available to your LLC. You can get a free personal credit score with NerdWallet and review your business credit score through Equifax, Experian and Dun & Bradstreet.
  • Determine the right financing option. Every business’s needs are different. If you don’t have the time in business, collateral or annual revenue to qualify for an SBA loan, then a term loan, business line of credit or invoice factoring arrangement could be your next best bet.
  • Apply for your loan. You can apply for a Small Business Administration-backed loan via an approved SBA lender. For term loans and business lines of credit, there are plenty of banks, credit unions and online lenders to choose from. Just be sure to shop around before applying for a small-business loan to get the best rates and terms possible.

Compare more small-business loan options

If none of the loans included here works for you, or if you’d like to compare loan options, NerdWallet has a list of small-business loans that are best for business owners. All of our recommendations are based on the lender’s market scope and track record and on the needs of business owners, as well as rates and other factors, so you can make the right financing decision.

Last updated on June 9, 2021

To recap our selections...

NerdWallet's Best LLC Business Loans of September 2021

Does your business need funding? Find your best loan options with Fundera by NerdWallet.

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