Published November 27, 2021 by WC Team

Find The Lowest Rates On Short Term Business Loans

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Overview Of Short-Term Business Loans

Usually, short-term loans are used to manage cash flow, emergencies or surprise opportunities. A short-term loan enables small businesses to fund short term capital needs. Typically, such loans have term lengths of a maximum of 18 months. But on average they are usually for a year.

Compared to other business-related financing options, short-term loans have high-interest rates. And offer lesser loan amounts. But unlike other loans, short-term loans are usually available through online lenders and are, thus, easy to obtain. This way the application process is shorter. And doesn't have too many requirements. Even the requirements that are there are very flexible. 

Short-Term Business Loan Details

There are a variety of short-term business loans available for small businesses. So, any of them can be the right type for you and your business. We have listed down the pros and cons of a short-term loan for you. So, it can help you decide whether short term loans will benefit you and your business.

Pros

Cons

The Best Short-Term Loan Lenders

After going through the pros and cons of short-term business loans do you feel that it is the best option for you and your business? you may be wondering where to find a reliable lender.

While a bank would be your best option it’s not easy to get a bank loan. To help, we have put together a shortlist of the best short-term loan lenders. If you still haven't found what you're looking for then check these options.

OnDeck

Amount:Upto $500,000

Interest rate:Between 9.99 and 99%

Term Length:3-36 Months

Qualifications:$100,000 annual revenue, one year in business, a credit score of 600

Best suited forFast funding for a large amount and a simple application

Credibly

Amount:$400,000

Interest rate:1.15 to 1.45 factor rate

Term Length:6-18 months

Qualifications:$15,000 monthly revenue, 6 months in business, a credit score of 500

Best suited forStartups with a low credit score or short-term loans for expansion or working capital

Fora Financial

Amount:Upto $500,000

Interest rate:1.1 to 1.3 factor rate

Term Length:Maximum 15 months

Qualifications:$12,000 monthly gross sales, 6 months of business

Best suited forQuick funding for startups and businesses with low credit scores

Rapid Finance

Amount:Upto $1 million

Interest rate:1.16 to 1.3 factor rate

Term Length:3-60 months

Qualifications:$120,000 annual revenue, 2 years in business, a credit score of 550

Best suited for:Businesses with a low credit score looking for large amounts

Idea Financial

Amount:Upto $250,000

Interest rate:Depends on your qualifications

Term Length:6-18 months

Qualifications:$15,000 monthly revenue, 2 years in business, a credit score of 650

Best suited forQuick funding for higher qualified businesses

How Do Short Term Business Loans Work?

Short-term loans are similar to small business loans in the way they are structured. You receive a certain amount of capital agreed on previously along with the interest rates, lender's fees and loan terms. And since these types of loans are usually needed urgently so online lenders are the best option.

Types Of Short Term Business Loans

How To Get A Short Term Business Loan

How To Qualify For A Short Term Loan

The requirements will vary depending on the type of short-term loan you're going for and who your lender is. However, the general standard is to have a credit score of at least 600, annual revenue of $100,000 and a minimum of one year in business. Of course, there may be lenders with more relaxed requirements and some would have stricter ones. However, this is just an approximation. 

Apply For A Short Term Loan

If you think you can qualify for a short-term loan the next step is to apply for one. And while the application will be easier than other kinds of loans you will still need some documentation. Some common requirements include:

The Bottom Line

If you're a small business owner and you're looking for quick funding then you should consider a short-term business loan. Even though these loans have a higher interest rate, they offer flexibility and an easy application process – which is perfect for emergencies. Explore your options to see whether this is the best option for you and your business.

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