Best loans for business owners with bad credit in July 2023

While you typically need good credit to qualify for a business loan, there are some lenders that offer business loans to borrowers with shaky credit histories. The lenders that offer the best business loans for bad credit — including business installment loans and lines of credit — have less stringent credit requirements (generally accepting credit scores of 600 and below).

To determine the best business loans for bad credit, we compared seven lenders by these metrics along with other factors like time-in-operation requirements, loan amounts, maximum repayment terms, funding time and customer service experience.

  • Best business loans for bad credit
  • Best for long repayment terms
  • Credibly business loans
  • Best for large loans
  • Fora Financial business loans
  • From participating partners via's website
  • Best for temporary cash-flow problems
  • National Funding business loan.
  • From participating partners via's website
  • Best for ongoing funding
  • Fundbox business line of credit

From participating partners via's website

Compare the best business loans for bad credit Why some lenders didn’t make the cut

Of the seven business loan lenders that we reviewed, just over half made the cut. The reasons for this were mainly due to not publicly disclosing information like time-in-operation requirements and funding speeds. The lenders that scored lower also do not advertise any perks or discounts to their customers.


Our expert writers and editors have reviewed and researched seven popular lenders to help you find the best business loan for bad credit. Out of all the lenders considered, the four that made our list excelled in areas across the following categories (with weightings): loan details (20%), loan cost (20%), eligibility and accessibility (35%), customer service (15%) and application process (15%).

Within each major category, we considered several characteristics, including APR ranges, late fees and prepayment penalties, loan amounts, maximum loan terms, minimum credit score requirements, time in operation requirements and funding time. We also evaluated each provider’s customer support options and customer reviews.

Types of business loans for bad credit

While you typically need good credit to qualify for a business loan, there are some funding options that might still be available to you even if you have bad credit, such as:

Business term loans: Private lenders offer both short- and long-term business loans, such as working capital loans and equipment financing. These can come with terms as short as a few months or as long as 10 years, depending on the lender. You’ll pay back a term loan in equal installments over a set period of time.

Business lines of credit: With this type of financing, you can draw and repay funds on a revolving basis without having to reapply for funds. Business lines of credit also typically come with higher limits compared to business credit cards.

Business credit cards: Similar to a line of credit, a business credit card gives you access to a revolving credit line that you can repeatedly draw on and pay off. Many also offer rewards on business spending. Note that some business expenses can’t be charged, though, such as payroll, inventory or leases.

SBA loans: A loan backed by the Small Business Administration (SBA) is generally considered less risky for the lender. This is because the SBA will cover a portion of the debt if you default. Because of this reduced risk, the requirements to get approved for an SBA loan are often less stringent compared to traditional business loans. However, you’ll typically have to provide a down payment along with collateral to secure the loan.

Pros and cons of bad credit business loans Pros

Can help cover a variety of business expenses.

Often have fast approval and funding speeds.

Might help to build your business credit. 


Generally have higher rates and fees compared to good credit loans. Could have lower borrowing limits. Might have to provide collateral.

How to apply for a business loan with bad credit

If you’re ready to apply for a business loan with bad credit, follow these steps:

1. Check your credit

When you apply for a business loan, the lender will review your credit to determine if you qualify — so it’s a good idea to check your credit beforehand to see where you stand. You can use a site like to review your credit reports for free. You can also check your FICO credit score for free through Experian, a credit-monitoring service or possibly your bank or credit card company. 

Additionally, several third-party companies allow you to review your business credit report. These include the credit bureaus Experian and Equifax as well as Dun & Bradstreet. If you find any errors, report them to the appropriate credit bureau to potentially boost your credit score.

2. Determine what kind of loan you need

Business loans are available for a wide array of purposes. For example, consider if you need working capital, money to help pay for necessary equipment or access to flexible funding for day-to-day expenses. By determining how you’ll use the funds, you can apply for the right type of business loan. 

3. Compare lenders and choose your loan option

Make sure to shop around and compare your options from as many business lenders as possible. This can help you find the right loan for your needs. Consider interest rates (or factor rates, if applicable) as well as repayment terms and fees. Additionally, be sure to check each lender’s eligibility criteria, including minimum credit score, time in operation and annual revenue requirements.

After you’ve compared lenders, pick the loan option that best suits your needs.

4. Gather documentation and apply 

When you apply, you’ll need to provide both personal and business information. For example, be prepared to submit business licenses, tax returns, financial statements, debt schedules (if any) and information regarding any collateral that will be used to secure the loan. Lenders might also ask to review a business plan or proposal to see how you plan to use the loan and your ability to repay it.

Once you’ve gathered your documentation, you’ll need to complete a full application. In many cases, this can be done fully online. However, some traditional lenders like banks and credit unions might require you to apply at a branch or over the phone. You might also need to discuss your options with one of the lender’s loan specialists to proceed.

5. Get your funds.

If you’re approved, the lender will have you sign for the loan so the funds can be disbursed — often by direct deposit. Note that while traditional banks and credit unions can take weeks or months to process loan funds, online lenders tend to be a much faster option. Depending on the lender, you could get your funds as soon as the same or next business day after approval.


Can I apply for a business loan with bad credit?

Yes, there are several lenders that offer business loans to borrowers with bad credit. Keep in mind that you’ll still need to meet other requirements, such as length of time in business and annual revenue amounts.

Can I get a startup business loan with bad credit?

Yes, you might be able to get a startup business loan even with bad credit. However, your business must have typically been in operation for at least six months to be eligible, and you’ll need to show proof of a certain level of annual revenue, depending on the lender. 

If you haven’t launched your business yet, you’ll likely have a hard time qualifying for a loan, especially without any revenue. In this case, you might consider other types of business financing — for example, you might get approved for a business credit card based on your personal income and personal credit score.

What is the lowest credit score for an SBA loan?

The SBA doesn’t have a specific minimum credit score requirement. However, the lenders that partner with the SBA to offer these loans set their own eligibility criteria. You’ll typically need a personal credit score in the mid-600s to qualify for an SBA loan, depending on the lender and type of loan. 

Your business credit history might also be reviewed. In this case, you’ll generally need a business credit score of at least 155.

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