How to Get an LLC Loan
Flexible funding for startup costs, working capital and more
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- Most business loans do not cater to specific business structures. An “LLC loan” is just a business loan you use to manage your LLC.
- Almost any type of loan can be an LLC loan.
- Instead of your business structure, consider your financing needs and business goals when deciding on financing.
- Pay attention to personal guarantees.
What is an LLC loan?
Spoiler: There’s no such thing as an LLC loan. Instead, it’s a marketing moniker used for small business loans taken out to build and manage LLCs.
LLC loans might come from online lenders, banks or credit unions, and they might be term loans, lines of credit or secured equipment loans. When shopping for LLC loans, the most important thing to consider is why you need the funding in the first place. Below, we’ve gathered our top picks for LLC loans whether you’re just starting up, dealing with less-than-perfect credit or in need of funding fast.
| Lender | User rating | Best for | Starting rate | Amount | |
|---|---|---|---|---|---|
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New businesses | 4.66% | Up to $250k | ||
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Equipment financing | 4.00% | Up to $500k | ||
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Working capital | 0.55% |
$2k – $250k |
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Fast funding | 7.80% |
$1k – $250k |
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Multiple product options | Around 3.00% depending on loan type |
$1k – $5M |
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Short-term loans | 1.11 (factor rate) |
$5k – $500k |
LLC business loan lenders at a glance
Best For : New businesses – Fundbox
- Starting rate
- 4.66%
- Amount
- Up to $250k
- Time in business
- 3 months
- Term
- 12 to 24 weeks
- Min. credit score
- 600
- Short minimum time in business requirement
- Relatively low credit score required
- No origination fees or prepayment penalties
- Low loan cap
- Short repayment terms
- Weekly, rather than monthly, payments
Fundbox offers short-term small business funding. Its maximum term length is just 24 months, and some loans are as short as 12 months. Fundbox offers lower time-in-business and annual revenue requirements. However, loans are repaid weekly rather than monthly, so business owners should be ready for an aggressive repayment plan.
Fundbox offers loans of up to $250,000 with terms running from 12 to 24 months. Borrowers should have a credit score of at least 600, have been in business for at least 3 months and be on track to earn a minimum of $30,000 in annual revenue.
Best For : Equipment financing- Fundible
- Starting rate
- 4.00%
monthly
- Amount
- Up to $500k
- Time in business
- 6 months
- Term
- 12 to 96 months
- Min. credit score
- 500
- Low credit score requirements
- High loan caps — up to $10,000,000 depending on loan type
- Wide variety of loan types available
- Relatively high minimum annual revenue requirements
- Contact information may be shared with third-party lenders
- Fee and interest structures vary widely by loan type, which can make comparison difficult
Fundible offers several different types of small business loans, including SBA loans, term loans, equipment financing and lines of credit. Bridge loans with terms as short as 3 months are available, while its SBA loans allow borrowers to take out up to $10,000,000 in funding and repay over as many as 120 months. With a low minimum credit score and a short time-in-business requirement, financing is accessible to a wide range of borrowers.
Fundible partners with third-party organizations to help you find the best business loan for your needs based on your qualifications. The minimum required credit score to qualify is just 500, and the minimum required time in business is 6 months. Some loan products through Fundible have high annual revenue requirements — as much as $150,000 for term loans and lines of credit. Fee structures and interest rates can vary widely between financing products.
Best For : Working capital – American Express Business Line of Credit
- Starting rate
- 0.55%
0.55% – 1.55% of the original principal loan amount is charged monthly during the loan term, along with a portion of the principal.
- Amount
- $2k to $250k
- Time in business
- 12 months
- Term
- 6 to 24 months
- Min. credit score
- 660
- Low starting interest rate
- Flexible, as-needed funding option
- No prepayment, application, management or origination fees
- Each draw is treated as a separate term loan and subject to credit approval
- Personal guarantee and business asset security required on each loan
- Must be in business for 12 months to qualify
A business line of credit gives you access to funding as you need it, rather than all at once. American Express Business Line of Credit has no prepayment, application or origination fees and a low starting interest rate, making it prime for working capital.
Borrowers need a credit score of at least 660 and at least 12 months in business. Once you qualify, each draw from the line of credit is treated as a separate installment loan, subject to a new credit approval process, and each loan requires a personal guarantee.
Best For : Fast funding – Bluevine
- Starting rate
- 7.80%
- Amount
- $1k to $250k
- Time in business
- 12 months
- Term
- Up to 12 months
- Min. credit score
- 625
- Receive funding in one or two business days
- Applying for and reviewing offers does not affect your personal credit score (though accepting an offer may)
- Line of credit or term loan available
- Higher starting interest rate than some lenders
- Contact information may be shared with third-party lenders
- Not available in all states
Bluevine offers a business line of credit and connects applicants to term loan lenders with the same application, giving you a variety of funding options to choose from. If you also have a business checking account with Bluevine, you can access funds almost instantly. If you don’t have a Bluevine account, you could receive loan funds within just a few business days. Additional fees apply for the fastest bank wire funding option.
Bluevine is one of the few lenders that requires LLC (or corporation) status to qualify. Along with an eligible business structure, you must have been in business for at least 12 months and make $10k in monthly revenue. Your personal credit score should be at least 625. Bluevine loans are not available in Nevada, North Dakota, South Dakota or U.S. territories.
Best For : Multiple product options – Bank of America
- Starting rate
- Around 3.00% depending on loan type
- Amount
- $1k to $5M
- Time in business
- Varies by loan type
- Term
- Varies by loan type
- Min. credit score
- Varies by loan type
- Wide range of loan products including business auto loans, equipment loans and multiple SBA loan options
- Cash-secured line of credit and other secured options make financing more accessible
- Low loan minimums
- Maximum interest rates not specified
- Starting rates vary significantly depending on loan product
- Many loan types require at least 24 months in business
Bank of America offers multiple business loan products, including secured options that help entrepreneurs with less time in business or lower credit scores access financing, as well as unsecured business loans and lines of credit. Bank of America also offers 504 and 7(a) SBA loans, SBA express loans, business auto loans and equipment financing.
Qualification requirements vary by loan type. The cash secured line of credit is the most accessible, with a minimum time-in-business requirement of only 6 months and a minimum credit score of 600. Other loans may require 2 years or even 4 years in business and annual revenue of $100,000 to $250,000.
Best For : Short-term loans – National Funding
- Starting rate
- 1.11
- Amount
- $5k to $500k
- Time in business
- 6 months
- Term
- 4 to 18 months
- Min. credit score
- 600
- Short time in business and low minimum credit score requirements
- Short loan terms and low minimum loan amounts available
- Funding as soon as the next business day
- $50 late fee for short-term loans
- Late fee of 15% of payment amount for equipment loans
- Origination fees may apply
- Payments must be made daily or weekly for terms between four and 24 months.
National Funding offers fast financing in as little as one business day with accessible minimum requirements and low minimum amounts and terms. Short-term and working capital loans are available with terms as short as 4 months.
National Funding requires applicants to be in business for 6 months for short-term and working-capital loans, and 24 months for equipment financing. For all loans, your business must have at least $250,000 in annual revenue, and your credit score should be at least 600.
Business loan types for LLCs
Small business loans come in many shapes and sizes. While this isn’t a comprehensive list, here are some of the most common types of LLC loans.
How it works: SBA loans are backed by the U.S. Small Business Administration (SBA), making them less risky for lenders and often more affordable for borrowers. There are subtypes of SBA loans, including 7(a) loans and 504 loans. These loans may also come with counseling and educational resources to help your business grow.
Best for: Business owners looking for low-down-payment real estate loans
Pros: May have lower interest rates, longer repayment terms and other affordability benefits for borrowers, as well as included support.
Cons: SBA loans can be difficult to qualify for and have a lengthy application process.
How it works: A term loan is any kind of loan, including a small business loan, in which you borrow a lump sum of money and repay it over a set period of time — the loan’s term. These loans can help businesses cover upfront expenses and repay over months or years.
Best for: Covering large, one-time expenses such as business remodeling or debt refinancing.
Pros: Many term loans offer fixed interest rates, making for predictable payments over the lifetime of the loan.
Cons: A single lump sum is less flexible than a line of credit and, depending on the loan, collateral or a personal guarantee may be required.
How it works: A line of credit allows the borrower access to a flexible pool of funding which can be used as needed, similar to a credit card. Some business lines of credit, like the American Express Business Line of Credit, make each withdrawal into a separate installment or term loan.
Best for: Flexibly funding ongoing projects and short-term working capital.
Pros: Borrowers can draw only the money they need, when they need it, rather than over-borrowing and paying unnecessary interest.
Cons: Many business lines of credit are offered at variable interest rates, which means rates can increase with market conditions over time; revolving credit can make it easy to overborrow.
How it works: Microloans are very small business loans, usually less than $50k or $100k depending on the lender’s definition. Microloans can help newer businesses and underserved communities get funding they might not otherwise qualify for. The SBA also backs microloans of up to $50,000.
Best for: Newer businesses, minorities and those with poorer credit.
Pros: Funding made available to entrepreneurs and businesses who might not otherwise qualify; in many cases, mentorship, support and resources are included.
Cons: As the name suggests, microloans have smaller loan caps and their efficacy for funding larger projects and expenses can be limited.
How it works: A merchant cash advance allows a business owner to borrow a lump sum in exchange for a percentage of future sales. Unlike other types of small business loans, fees are often expressed as a factor rate instead of an interest rate or APR. A factor rate of 1.3, for example, means the business would repay the amount of the advance plus 30%, automatically deducted from sales.
Best for: Those with urgent upfront cash needs and confidence in high profit margins.
Pros: Quick funding that can be easier for newer business owners or those with poorer credit to qualify for.
Cons: Costs can be less transparent and more expensive than other types of small business financing.
A secured loan typically requires collateral. For instance, an equipment loan can be secured by the equipment being purchased with the borrowed funds. The lender can repossess the equipment if you fail to pay. Some secured loans and lines of credit use a refundable cash deposit as the security.
An unsecured loan, on the other hand, does not require collateral. The lender takes on more risk with these types of loans.
Both term loans and lines of credit can be secured or unsecured. Secured loans are often available to borrowers with lower credit scores or less time in business and may help newer businesses access funding that might otherwise be unavailable. Unsecured loans may be funded more quickly and are better suited for short-term borrowing needs.
Where to get an LLC loan
Small business and LLC loans are available from a variety of lenders, each with its own drawbacks and benefits to consider.
| Best for… | Pros | Cons | |
|---|---|---|---|
| Banks | Borrowers looking for a specific loan type or larger loan |
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| Online Lenders | Those looking for fast and easy funding, even if it may cost more |
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| Credit Unions | Borrowers with an existing credit union relationship |
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Generally, your business structure is not a primary factor in your loan approval odds. Instead, lenders are looking at your time in business, annual revenue and cash flow, personal credit score and other financial factors.
However, some business lenders loan exclusively to LLCs or corporate structures, but not sole proprietors. Additionally, forming an LLC and getting an Employer Identification Number (EIN) can help you build business credit, which may benefit your business loan application.
What you’ll need to qualify for an LLC business loan
Each lender has its own requirements for business loan applicants. Specific minimum requirements may vary depending on the type of business loan you’re applying for, even from the same lender. Although the minimums may vary, here are the basic factors lenders are likely to look at.
Credit score
Business lenders often consider your personal credit score as well as your business credit score, if you have one. Your personal credit score is tied to your Social Security number, while a business credit score is usually tied to an Employer Identification Number, or EIN.
For both personal and business credit, higher scores generally mean easier qualification and more favorable terms, including lower interest rates. Many lenders have a minimum credit score requirement below which applicants will be disqualified, often around 600.
Time in business
The longer your business has been up and running, the more it demonstrates viability to potential lenders. More mature businesses often get lower rates, though newer businesses may still be able to access funding with secured loans (which involve collateral or require a cash deposit).
Lenders may have a minimum time-in-business threshold for business loans, which may be as low as six months or as high as 24 months or more.
Revenue and cash flow
Cash flow is another important factor for most lenders. After all, if your business isn’t generating revenue, loans may be harder to repay.
Businesses with higher annual revenue rates may see more favorable loan terms and have an easier time qualifying. Lenders may also set minimums in this category, ranging from $30k per year to $250k per year or more.
Collateral
Collateral is an asset that a borrower pledges, as part of the loan agreement, to secure the loan. For example, when you take out a mortgage to buy a piece of property, the property itself is collateral. If you don’t repay the loan, your home can go into foreclosure. The lender repossesses and sells the property to recoup their losses.
Business loans can also be secured by collateral, whether it’s real estate, equipment or a cash deposit for a secured line of credit. Secured loans can make funding more accessible for newer businesses or those with poor or thin credit histories by lowering the minimum required credit score or time in business.
Financial health
Along with these specific factors, lenders may also look at the overall financial health of your business. This might include your debt-to-income or debt-to-revenue ratio (which is a measurement of your business’s earnings against its existing debt liabilities), cash on hand, the quality of any capital investors and more.
A personal guarantee is a promise that the borrower will personally repay a business loan out of their own pocket, even if the business fails.
If you sign a personal guarantee, you’ll still be liable for the loan, even if you’re borrowing as an LLC, or Limited Liability Company. In other words, the personal guarantee voids or pierces the limited liability element of the LLC. However, limited liability usually remains in place for other business negotiations like contracts, service agreements or potential lawsuits.
New LLC with no revenue? Here are funding options
When you’re just getting started, your funding needs can be high, but meeting minimum revenue and time-in-business requirements for LLC loans can be challenging. Fortunately, you have other options to consider when looking for financing.
Business credit card
Like a personal credit card, a business credit card allows you to borrow and repay funds on credit over time. Like personal credit cards, however, business credit cards can carry relatively high interest rates, and it can be easy to take out more debt than you strictly need.
Crowdfunding
Crowdfunding has become a popular way to raise money for startups, made accessible through online platforms like Kickstarter, Kiva and Fundable. Business crowdfunding can unlock financing without needing a specific credit score or annual revenue figure, but platforms do charge their own fees for their services. Additionally, you may need to aggressively market the crowdfunding campaign to meet your funding needs.
Grants
Small business grants may also be used to cover startup costs or keep a business running. Grants, which do not need to be repaid, are offered by state and local governments, industry-specific organizations and through the federal government. Grants.gov is a great place to get started. Keep in mind, though, that because grants are attractive sources of funding, they can be very competitive.
Step-by-step: How to apply for an LLC business loan
Ready to get started? Applying for an LLC small business loan takes just a few steps.
1. Check your credit score
Small business loans often have minimum credit score requirements. Understanding your score ahead of time can help you narrow your search for a lender and understand what types of loans you’re likely to qualify for. LendingTree makes it easy to check your credit score whenever you want to and to track changes over time.
2. Gather EIN and other documents
Required documentation may vary by lender, but in most cases you’ll need your EIN — think of it like a Social Security number for your business, business plan, income statement, business bank statements and tax returns. If collateral is involved, you’ll also need documentation proving your ownership of the asset and, potentially, valuation documents (like a real estate appraisal).
3. Compare lenders
Once you’ve gathered the required documents, you can begin the process of shopping around for the right lender for your needs. Along with looking for the specific type of loan that’s the best fit for your business needs, you can also compare lenders based on their minimum eligibility requirements, like credit score and time in business.
Some online lending platforms make it easy to compare multiple offers with one initial application. This lets you choose from a range of loan options and compare interest rate ranges and terms directly. After you accept an offer, a more rigorous approval process takes place, including a hard credit inquiry.
4. Close and receive financing
Once you complete the application, provide all required documentation and get approved, you’ll review and sign the business loan agreement and receive financing. In many cases, funding will be disbursed directly to your business bank account. The process may take just a few hours or several business days.
Instead of applying with multiple lenders, you can compare offers from our network of 30+ business lenders in one place.
How it works:
Tell us what you need — Fill out a quick form in minutes.
Compare offers in minutes — Review multiple loan options side by side.
Choose and get funded in as little as 24 hours — Select the best offer and receive funds, sometimes within 24 hours.
Methodology: How we chose the best LLC business loans
We considered more than 30 leading small business lenders to determine the best options for LLCs across a range of financing needs. To make our list, lenders had to meet the following criteria:
- Eligibility requirements: Since LLCs range from brand-new, no-revenue entities to established businesses with years of operating history, we prioritized lenders with a range of credit score, time-in-business and annual revenue requirements — including options for newer LLCs and owners with less-than-perfect credit.
- Rates and terms: We prioritized lenders with competitive starting rates, transparent fee structures and flexible repayment terms, factoring in loan amounts that work for both smaller working-capital needs and larger financing goals.
- Time to funding: Because cash flow needs can be urgent, we prioritized lenders that can fund within one to three days, noting instances where funding timelines are longer (as is typical with SBA and bank financing).
- Business structure flexibility: We confirmed each lender works with LLCs specifically (rather than only sole proprietorships or corporations) and noted any LLC-specific requirements, such as minimum member count or state restrictions.
- Repayment experience: We considered each lender’s reputation and business practices, favoring lenders that report to major business credit bureaus, offer reliable customer service and provide added value like rate discounts, dedicated support or working capital tools.
Frequently asked questions
If the lender runs a hard credit inquiry during the qualification process, an LLC loan can affect your credit score at that point, though the impact is usually relatively small and short-lasting. However, if you take out an LLC loan that requires a personal guarantee and don’t repay it, that could substantially hurt your credit score.
The structure of your business (LLC, sole proprietorship, S-corp, etc.) doesn’t usually matter for the qualification process as much as factors like your credit score, time in business and monthly revenue. Whether it’s difficult or easy to get a business loan with your LLC depends on your financial standing and the lender’s requirements.
Some small business loans are specifically geared toward startups and small businesses without much credit history. Secured loans or lines of credit, which require collateral in the form of a tangible asset or cash, can be easier to qualify for than unsecured financing.
No, you don’t need an LLC to apply for a business credit card. Freelancers and sole proprietors can also apply for a business credit card, as can entrepreneurs using other corporate structures.