Capital One Small Business Loans Review


What is Capital One?

Capital One is a corporate bank offering financial products and services to clients in the U.S., Canada, and the UK. The financial giant offers small business loans, business lines of credit, and small business checking, savings and credit cards through its Spark Business suite of products.

Although Capital One began offering small business financing in 2005, it didn’t begin focusing specifically on small businesses until the launch of the Spark Business brand seven years ago.
Its lending products along with various checking, savings, and 401(k) offerings, are available to small businesses located in Connecticut, Delaware, Louisiana, Maryland, New Jersey, New York, Texas, Virginia and Washington, D.C.


Features of banking with Capital One

Capital One customers will have the security of working with an experienced small business lender. Here are some great features of banking with one of the top banks in the country:

  • Intuitive resources – Through its Spark Business products, you will have access to resources and insights that will help to start, grow and improve your business. These resources include in-depth advice for running a successful business.
  • Customer incentives -Capital One rewards loyal customers with incentives and discounts for those who participate in multiple products.
  • Merchant services – Capital One offers merchant services to help you with your business needs, including ecommerce.

It can be tough securing a loan with Capital One, but it’s worth a shot if you have a strong credit profile and your business is doing well.


What Capital One offers?

Capital One offers five different solutions for small business financing that start from $10,000 and go up to as much as $5 million for current customers, depending on product type and eligibility.

  • Business Installment Loans offer fixed-monthly payments which may be an ideal solution for businesses looking to purchase long-term assets or expand their operations.
  • Equipment and Vehicle Loans offer fixed monthly payments and may be ideal for small businesses that need to buy, replace or refinance equipment. Qualified buyers may be get up to 100% financing.
  • Small Business Real Estate Loans lets customers finance 85% of the property’s value. It requires fixed monthly payments whether it’s a fully amortized loan or balloon loan.
  • Working Capital Lines of Credit are great for small businesses that need help with their cash flow needs.

The annual percentage rate (APR) for Business Installment Loans, Equipment and Vehicle Loans and the Small Business Real Estate Loans could range from 5.9% to 16.9%. They also have a one-time origination fee of $150, and loans are subject to a $39 late fee or 5% of the amount due, whichever is greater.

The Working Capital Line of Credit has a variable rate that could range between 6.65% and 18.65% and is subject to a one-time origination fee of 0.5% of the credit line and an annual fee of 0.25% of the credit line.

Capital One offers three options through their Small Business Association (SBA) lending program, offering loan features they might not get with a conventional loan.

SBA 7(a) Loan Program: The most basic loan program offered by the SBA offers a wide range of options for small businesses, including long-term financing, fixed maturity, and no balloon payments.

SBA 504 Loan Program: Working with a Certified Development Company (CDC) – a private, non-profit corporation that contributes to the economic development of local communities – to offer long-term, fixed-rate financing.

SBA Express LOCs (line of credit): SBA guarantees lines of credit up to $350,000 for working capital.

Loan product Loan amount Loan term APR range/ factor rate Fees Time to funding
Business Installment Loans Starts at $10,000 Up to 5 years Could range 5.9% – 16.9% One-time origination fee of $150 Varies from hours to a few days
Equipment and Vehicle Loans Starts at $10,000 Up to 5 years 5.9% – 16.9% One-time origination fee of $150 Varies from hours to a few days
Real Estate Term Loans Up to $5 million Up to 20 years and amortization up to 30 years for preferred industries 5.9% – 16.9% One-time origination fee of $150 Varies from hours to a few days
SBA Loans Varies Varies Varies Varies Varies from hours to a few days
Working Capital Line of Credit Starts at $10,000 Varies Variable rate that could range from 6.65% – 18.65% One-time origination fee of 0.5% of the credit line and annual fee of 0.25% of the credit line. Varies from hours to a few days

Rates current as of 6/21/2018


Eligibility requirements

**NOTE: CAPITAL ONE REP SAID ITS UNDERWRITERS DETERMINE THIS AND IT DOESN’T DISCLOSE THIS INFORMATION EXTERNALLY


Ineligible industries for Capital One business loans

Capital One doesn’t specify on its website, which businesses or industries are not eligible for small business loans. However, through its partnerships with organizations like Kiva and Grameen -Microlenders committed to helping low-income and impoverished communities by matching them with lenders- Capital One strives to help small business owners that don’t have a well-established credit history.


How to apply for Capital One financing

Capital One requires small business owners to apply in person for one of their small business lending products. This is great if you’re hesitant about applying online, but can be inconvenient for business owners with a full schedule.

Documentation requirements for Capital One financing vary by loan size and type. Loans that are $50,000 or less may not require financial documents. You will need the following documents if you’re seeking more than $50,000 in financing:

  • Three years of personal and business tax returns
  • Current financial statements and projections
  • Personal financial statements

SBA loans require more comprehensive documentation for its various loan products. Those include:

  • Borrower Information Form (SBA Form 1919) completed by all associates of the business applicant
  • Personal background and financial statement
  • Business financial statement
  • Business certificate/license
  • Loan application history
  • Income tax returns
  • Resume
  • Business overview and history
  • Business lease

Pros/Cons

Pros Cons
 Offers various loan products   Must have a Capital One business checking account
  Loans under $50,000 may not require financial statements   Must apply at a branch located in one of eight states (including Washington, D.C.)
  No repayment penalty   Limited information available online

Should you apply with Capital One?

Capital One’s small business lending products are pretty standard when stacked up against other traditional banks. If you’re a small business owner that’s been in operation for at least two years and has a well-established credit history, a business loan with Capital One may be a good solution for you.

Capital One has limited information about its lending products available online compared to other lenders, so be sure to do your homework and speak with a representative before submitting an application.