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6 Best Small-Business Loans for Veterans of December 2021

Commercial lenders, nonprofit organizations and the U.S. Small Business Administration offer small-business loans for veterans.

Steve NicastroJune 21, 2021

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Veterans can take advantage of counseling, training and discounted rates on small-business loans, to help start, sustain and expand their small business.

The Small Business Administration, for example, waives the upfront fees (typically 2% to 3% of the loan amount) on SBA Express loans for veterans and their spouses. And many community financial institutions focus on small-business loans for veterans, minorities and women.

Whether you turn to a traditional bank, an online lender or a community organization, look for loan terms that meet your needs — whether that’s hiring new employees, purchasing equipment or covering other costs.

Here are the best business loans for veterans, plus more information on VA loans and other financing resources.

How Much Do You Need?

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Est. APR
Min. Credit Score

Lender	Best For	Est. APR	Min. Credit Score	Next Steps
OnDeck - Online term loan See Your Options with Fundera by Nerdwallet	Best for Fast cash	9.00-99.00%	600	See Your Options with Fundera by Nerdwallet
SBA Express loan See Your Options with Fundera by Nerdwallet	Best for Fast cash	7.75-9.75%	650	See Your Options with Fundera by Nerdwallet
BlueVine - Line of credit See Your Options with Fundera by Nerdwallet	Best for Working capital	15.00-78.00%	600	See Your Options with Fundera by Nerdwallet
SBA 7(a) loan See Your Options with Fundera by Nerdwallet	Best for Expansion financing	5.50-8.00%	650	See Your Options with Fundera by Nerdwallet
Credibility Capital - Online term loan See Your Options with Fundera by Nerdwallet	Best for Expansion financing	6.99-24.99%	650	See Your Options with Fundera by Nerdwallet
BlueVine - Invoice factoring See Your Options with Fundera by Nerdwallet	Best for Businesses with unpaid customer invoices	15.00-68.00%	530	See Your Options with Fundera by Nerdwallet

Summary of 6 Best Small-Business Loans for Veterans of December 2021

Our picks for

Fast cash

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OnDeck - Online term loan

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Est. APR

9.00-99.00%

Min. Credit Score

600

OnDeck offers a fast term loan for small-business owners with less-than-stellar credit who want to expand.

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 frequent (daily or weekly) repayments.
Requires business lien and 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.

May fund quickly

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SBA Express loan

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Est. APR

7.75-9.75%

Min. Credit Score

650

SBA Express loans are available up to $500,000 as either a term loan or line of credit.

Pros

Available as a term loan or line of credit.
Interest rates are capped.
Faster processing time compared to other government loans.

Cons

Personal guarantee is required.
Lower borrowing maximum than other government loans.
Shorter repayment term for line of credit than 7(a) loans.

Read full review

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

Working capital

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BlueVine - Line of credit

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Est. APR

15.00-78.00%

Min. Credit Score

600

BlueVine's line of credit provides fast working capital for short-term borrowing needs.

Pros

Cash can be available within 12 to 24 hours.
Multiple term lengths for different financing needs.

Cons

Short repayment term results in higher payment amounts.
Requires personal guarantee.
Not available in North Dakota, South Dakota or Vermont.

Read full review

Qualifications:

6-month line of credit:
Minimum credit score: 600.
Minimum time in business: 6 months.
Minimum annual revenue: $120,000.
12-month line of credit:
Minimum credit score: 600.
Minimum time in business: 6 months.
Minimum annual revenue: $120,000.

May fund quickly

Our picks for

Expansion financing

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SBA 7(a) loan

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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.

Read full review

Qualifications:

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

Lowest interest rate

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Credibility Capital - Online term loan

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Est. APR

6.99-24.99%

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

Businesses with unpaid customer invoices

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BlueVine - Invoice factoring

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Est. APR

15.00-68.00%

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.

Lowest credit score required

How Much Do You Need?

Can you get a VA business loan?

To qualify for a veteran business loan, your business must be majority owned (at least 51%) by someone in one of the following categories:

Active-duty military service members participating in the Transition Assistance Program.
Honorably discharged or service-disabled veterans.
Reservists and active National Guard members.
Current spouse of a veteran, active-duty service member, reservist or guard member.
Widowed spouse of a service member who died in service or from a service-related disability.

You’ll also need to meet general small-business loan qualifications, such as credit score, revenue and time in business. The exact requirements will vary by lender.

» MORE: How to get a business loan in five steps.

Veteran business loan options

Veteran business loans, often referred to as VA loans, are available through commercial lenders, nonprofit organizations and the Small Business Administration. (The Department of Veterans Affairs does not provide business loans.)

While some popular loan programs for veterans have been discontinued, including the SBA’s Veterans Advantage and Patriot Express Loans, there are plenty of other options for veterans and their families.

Veterans can borrow up to $1 million ($500,000 after Oct. 1, 2021) through the SBA’s Express loan program. Upfront guarantee fees, typically 2% to 3% of the loan, are waived for veterans, reservists, national guard members and spouses who qualify.

SBA Express loans have a quicker turnaround time than other SBA loans — 36 hours compared with several weeks or months — but the underwriting criteria can be strict. You’ll likely need a minimum FICO score of 650, strong annual revenue and at least two years in business to get an Express loan.

If you just launched your businesses or have bad credit, look into online lenders, which tend to have more flexible requirements (but higher rates).

Other SBA programs for veterans or service members include:

Military Reservist Economic Injury Disaster Loan Program. The MREIDL can provide up to $2 million if you have an essential employee who is a military reservist and gets called to active duty. This program is for covering regular business operating costs, not starting or expanding a business.
SBA 8(a) program. The SBA offers this business development program to eligible businesses, which can include those owned by veterans. The SBA 8(a) program provides small businesses with a certification that can improve their chances of winning government contracts, as well as help navigating the bidding process.

» MORE: Small-business grants and resources for veterans

Are there startup business loans for veterans?

Lenders generally prefer to do business with established companies that have strong cash flow. This often disqualifies startups with less than a year of operating history and little revenue.

However, veterans and other new business owners aren't completely out of luck: If you have good personal credit, your options include business credit cards and personal business loans.

Business credit cards. These typically provide up to $50,000 in revolving credit, meaning you can borrow and repay from the credit card as needed, and pay interest only on withdrawn funds.
Personal loans for business. These offer a lump sum of cash, with a fixed interest rate and repayment terms.

Both options are unsecured, meaning you won’t have to put down collateral — an asset, such as real estate or inventory — to qualify.

» MORE: Where to find startup business loans

Comparing small-business loans for veterans

When shopping for a loan, be sure to compare annual percentage rates, or APRs, which give you a holistic picture of a loan's cost. NerdWallet's small-business loans comparison tool can help. We've gauged lender trustworthiness, market scope and user experience, among other factors to help you choose the best loan.

If you're a veteran or related to a servicemember, look at lenders that cater to the military. Some may not offer funding; for example, USAA’s business loan program ended in 2018. But discounts may be available from other lenders. Bank of America reduces loan administration or origination fees 25% for veterans, for instance.

For other financial resources for veterans, check out our list of small-business grants for veterans or personal loans for veterans. The SBA also offers Veterans Business Outreach Centers across the nation.

Last updated on June 21, 2021

To recap our selections...