Emergency Business Loans That’ll Get You Fast Funding
An emergency business loan provides short-term funding to help you recover from an unexpected expense or other disaster. This type of funding can get you cash fast, but be aware that this can also be an expensive borrowing method. We’ll cover the ins and outs of emergency business loans to help you determine if it is the best solution for your business.
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Best emergency business loans
Here are our picks for the best emergency business loans:
|Lender||Best for||Maximum amount||Minimum credit score||Time to funding|
|Line of credit||Up to $150,000||600+ personal FICO Score||Soon as the next business day|
|Short-term business loan||$250,000||625||Same business day for certain states|
|Business line of credit for high-revenue businesses||$250,000||625||Same day to 3 days|
|Startup businesses||$2,000,000||550||24 hours or less after approval|
|Businesses with bad credit||$400,000||500||Soon as the same day|
Learn more about how we chose our picks.
Fundbox: Best emergency line of credit
|Term length||12 weeks or 24 weeks|
|Max. loan amount||Up to $150,000|
|Starting interest||4.66% for 12-week terms 8.99% for 24-week terms|
|Min. credit score||600+ personal FICO Score|
|Min. time in business||6 months recommended|
No early prepayment fees
Available in all 50 U.S. states
Minimum annual revenue of $100,000 required
$6 late payment fees
OnDeck: Best emergency short-term loan
|Term length||Up to 24 months|
|Max. loan amount||$250,000|
|Min. credit score||625|
|Min. time in business||1 year or more|
Varied loan amounts starting at $5,000
Can possibly qualify for the prepayment benefit option that allows you to pay the loan off early without fees or interest
Funds not available for all industries
Can come with an origination fee up to 4.00%
Bluevine: Best emergency funding for high-revenue businesses
|Term length||6 or 12 months|
|Max. loan amount||$250,000|
|Starting interest||6.20% simple interest for a 26-week repayment term|
|Min. credit score||625|
|Min. time in business||24 months|
Fast application process with a decision usually within minutes
No monthly fees
Minimum annual revenue of $480,000
$15 wire fee to receive funds within few hours
Taycor Financial: Best emergency business funding for startups
|Term length||12 to 84 months|
|Max. loan amount||$2,000,000|
|Min. credit score||550|
|Min. time in business||N/A|
No down payment
No specific minimum annual revenue
Website is not fully transparent on all eligibility requirements
Credibly: Best emergency business loans for bad credit
|Term length||6 to 15 months|
|Max. loan amount||$400,000|
|Starting interest||Factor rate of 1.11|
|Min. credit score||500|
|Min. time in business||6+ months in business|
They are a direct lender of working capital loans, so you won’t need to work with any outside lender
Quick Draw funding program allows you to access more funding if and when you need it
Must secure your loan with collateral valued up to 90% of loan amount
Comes with an origination fee of 2.50%
Types of emergency business loans
If you’re a business owner and need funds fast, there are small business loans specifically suited for emergency business funding. Here are a few options to consider.
Business term loan
A business term loan provides borrowers with a lump sum of cash upfront to be paid back in recurring daily, weekly or monthly installments. Repayment periods for short-term business loans are usually around three to 24 months, while long-term loans can extend anywhere from three to 10 years. Short-term business loans, which are often found with online lenders, are more suitable for emergency funding because they offer a much faster turnaround time for funding than long-term loans, which could take several weeks.
Business line of credit
A business line of credit is a revolving form of funding where you only pay interest on what you borrow. Unlike term loans, which give you the cash upfront, this is a more flexible form of financing, suitable for recurring expenses or plugging cash flow gaps. Terms for lines of credit can range from as short as 12 weeks to as long as several years. Interest rates can be from 4% to 60% and are determined by the borrowed amount and repayment terms.
Merchant cash advance
A merchant cash advance offers a business an advance lump sum borrowed against future sales. The lender takes a percentage of the business’s future credit card sales until the loan is paid in full. Interest is charged as a factor rate, usually between 1.2 and 1.5, and is multiplied by the advance amount. This could be an option to consider if your business does a high volume of credit card sales, but it’s worth being aware that this option could cut into future profits.
Invoice financing is a type of funding that is usually best suited for businesses with unpaid invoices. The invoices are sold to a factoring company for a cash advance of about 70% to 90% of the unpaid invoices. This type of funding places more emphasis on your business’ invoices than a high credit score, making it a viable option for businesses with bad credit.
Working capital loans
Working capital loans are a variety of loan products that can be used to cover short-term operating expenses. Working capital loans can be anything from short-term loans to a business line of credit, merchant cash advances or even SBA loans. Each product has its own repayment plan, with some that may require daily, weekly or monthly payments.
SBA disaster loan
The U.S. Small Business Administration (SBA) offers disaster loans to help provide funding in the case of an emergency, such as a natural disaster. To be eligible for this type of SBA funding, your business must be located in a declared disaster area. Funding can be used for anything from equipment replacement to getting any upgrades to help prevent possible destruction in the future.
How to apply for an emergency small business loan
The application process to get an emergency small business loan can vary depending on products and lenders, but there are a few steps you’ll likely need to follow no matter what you choose.
1. Decide why you need the funds
Determine why you need the funds now and what you need them for, such as to replace broken equipment or repair property during a natural disaster. Targeting your specific needs will allow you to find the best loan option.
2. Determine what you qualify for
Lenders will look at your personal credit score when determining eligibility, with the best rates usually given to those with higher scores. Depending on the loan and lender, you may need to put up collateral in case you default on your loan. Lenders will likely require your business to be operating for a specific length of time, ranging anywhere from six months to two years or more.
3. Gather the required documents
Lenders typically look at certain documents when determining your eligibility for their loans. These documents can vary but usually consist of a business plan, a balance sheet, and both your personal and business tax returns.
4. Compare lenders and apply
Compare lenders to ensure you’re getting the best product for your business needs. A few things to compare between lenders are interest rates and repayment terms, along with any fees associated with the products offered.
When to consider fast business funding
You could consider an emergency business loan when you need to:
- Meet payroll or pay bills because receivables are delayed
- Pay operational expenses during slowdowns
- Replace broken equipment
- Repair property damaged in a disaster
- Cover sudden, necessary changes in operations
- Pursue an urgent business opportunity
What to ask yourself when considering emergency business loans
Because emergency business funding can be expensive — and borrowing could compound ongoing financial problems — take a moment to ask yourself these questions before applying for an emergency business loan:
- How much money do I need?
- If I get that much money, how will I pay it back — plus interest?
- Do I need the funding right away or am I anticipating its need?
- How fast do I need to receive the money after applying?
- How much information am I willing to provide to apply?
- Do I need one-time, recurring or ongoing funding?
- What loan terms work best for me?
- Does my credit score or credit history make it difficult to qualify?
- Do I have unpaid invoices I could leverage to get funding?
- Is my need caused by a declared disaster?
Emergency business loan alternatives
Emergency business loans may not be for everyone, and that’s when alternatives such as a business credit card or a personal loan can come in.
|Alternative||Typical time to funding|
|Business credit card|| |
|Personal loan||Within 24 hours of approval or up to several days|
Business credit card
A business credit card is a revolving credit line that provides limited funding when needed. While some credit cards can come with 0% interest during an introductory period for new account holders with excellent credit, the average annual percentage rate (APR) can range from 13% to 29% or higher. Those with bad credit may qualify for a much lower credit limit than those with excellent credit, and interest can also accumulate if you don’t pay your credit card bill in full each month.
A personal loan is similar to a term loan, where you receive a lump sum of cash that you’d repay in regular installments. Personal loans can be secured or unsecured, a type of loan that does not require any assets but you’ll likely pay higher rates and need a good credit history to qualify. The APR on personal loans differs depending on your credit score, too. For example, someone with a high score of 720 may receive a rate of 14.37%, while a borrower with a score of around 560 to 579 might get a much higher rate of 122.22%.
How we chose our picks
To appear on our list of best emergency business loans, lenders needed to meet the following criteria:
- Required minimum credit score below 640
- Loan amounts of $100,000 or greater
- Transparent starting interest rates and repayment times
- Able to receive the funds within 3 business days
Frequently asked questions
Small business owners with bad credit may still be eligible for an emergency business loan. It’s possible not all products will be available to those with bad credit, but funding options, including merchant cash advances and invoice factoring, might be. However, borrowers with bad credit can expect higher interest rates than those with good to excellent credit and may need to offer collateral to increase their chances for approval.
Emergency business loans can come from online lenders, credit unions and traditional banks. However, traditional banks may have stricter eligibility requirements and will likely not be as fast for approval and funding as online lenders.
It may be possible to get emergency business funding close to immediately. Many lenders — including our picks for the best emergency business loans — offer fast funding, including the same business day or within hours upon approval. Online lenders will likely offer the fastest approval time and funding.
To get an Economic Injury Disaster Loan (EIDL) from the SBA, your business must have been damaged in a declared disaster area. For this type of emergency business loan, you will also need to apply before the deadline, which is nine months from the disaster declaration.
A personal guarantee makes owners personally responsible for paying off their company’s debt if they should default on a loan. This type of guarantee is usually targeted toward riskier borrowers who are not yet financially stable and could have trouble paying off the debt.