TD Bank Business Loan: 2018 Review


What is TD Bank?

TD Bank is the American subsidiary of Toronto-Dominion Bank, one of the largest banks in North America, and has nearly 1,300 locations along the East Coast. The Canada-based lender has operated in the U.S. since 2007 and has provided more than 8.9 million U.S. customers with various retail, small business and commercial banking products.

TD Bank’s small business banking division offers a full suite of lending products, including lines of credit, term loans, commercial mortgages, Small Business Administration (SBA) loans, United States Department of Agriculture (USDA) business loans and business credit cards.


Lender highlights

TD Bank offers a wide breadth of small business lending products ranging from $10,000 to $1 million that cater to both small and larger-sized businesses.

TD Bank’s application process is thorough and similar to ones found at most traditional lenders. You must provide supporting documents and, in some cases, may need to apply in person. Small business borrowers can apply online for loans and lines of credit up to $100,000, but larger funding requests must be done at a branch location.

The bank is not nationwide and has branches in just 15 states – Connecticut, Delaware, Florida, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, North Carolina, Pennsylvania, Rhode Island, South Carolina, Vermont and Virginia – and Washington, D.C.


What TD Bank offers?

Secured term loans: TD Bank offers three- and five-year term loans that range from $10,000 to $1 million with a fixed interest rate. This product is best for one-time financing for equipment purchases, renovation or lump-sum working capital. These loans are typically secured by equipment, inventory or cash with fixed monthly payments automatically deducted from your checking account.

Secured lines of credit: These range from $25,000 to $500,000 with a variable interest rate of the prime rate plus 0.74 percentage points. These are typically secured by cash or accounts receivable and can cover business expenses such as rent, payroll and inventory. You can pay the line down and use it again, choose to make an interest-only payment or access money by check or online transfer. Monthly payments are automatically deducted from your small business checking account.

Commercial mortgage loans: These are available for borrowers purchasing real estate or refinancing a property they already own. TD Bank’s commercial real estate loans are available for up to $1 million with a fixed interest rate at a 20-year term. Fixed monthly payments are automatically deducted from your checking account.

Lending for Healthcare Professionals. TD Bank’s Healthcare Practice Solutions Group, allows dental and veterinary practices to qualify for up to $5 million in practice value financing and working capital. Eye care professionals and physicians could potentially receive up to $3 million in practice value financing and working capital. The loan terms range from five to 30 years with a fixed rate that can fall between 4.5% and 5.5%.

Lending for Restaurant Franchisees. TD Bank’s Restaurant Franchise Financing Group provides financing to operators of major franchisors including McDonald’s, Dunkin’ Donuts and Wendy’s. These loans could be used for franchise acquisitions, buyouts, partnership buy-ins, commercial real estate and more.

Government-sponsored Loans. Through TD Bank, borrowers can qualify for a business loan backed by the U.S. Department of Agriculture or one of three loans guaranteed by the Small Business Administration: SBA Express Loan, SBA 7(a) Loan and SBA 504 Loan. The SBA products have maximum loan amounts of $5 million and fixed interest rate ranging from 2.25% to 4.75%. The USDA loan amounts max out at $25 million and are intended for rural businesses only.

TD Bank Business Loans: At a glance
Loan product Loan amount Loan term APR range/ factor rate Fees Time to funding
Business Term Loan $10,000 to $1 million 3- or 5-year terms Fixed Waived origination fee for loans up to $100,000 Varies
Commercial Real Estate Loan Up to $1 million 5-year term, up to 20-year amortization Fixed Waived appraisal fee at closing Varies
Healthcare Practice Solutions Group Up to $5 million 5 to 20 years Fixed 4.5% to 5.5% 25% to 1% Three to seven business days
Revolving Business Line of Credit $25,000 to $500,000 On demand Variable (WSJ prime rate +0.74%) Waived origination fee for loans up to $100,000 Varies

Rates current as of 6/22/2018


Eligibility requirements

TD Bank declined to provide specific annual revenue, credit score and time in business minimums for each of its loan products. However, bank representatives said there isn’t a minimum credit score that determines eligibility for its small business lending products. Instead, the minimum credit score required fluctuates depending on the underwriting and risks involved.

TD Bank requires a few years of tax returns and a down payment of 10% to 20% of the borrowing amount for loans. The bank also takes into account your business revenue and number of years you’ve been in business to determine which loan or line of credit best suits your business needs.

Businesses that are not eligible for TD Bank Business Loans loans:

Applicants must be within 90 miles of a branch location. TD Bank only has locations in 15 East Coast states and in Washington, D.C.


How to apply for TD Bank Business Loans financing

Businesses looking to get a line of credit or small business loan need to prepare the following before meeting with a TD Bank small business representative:

  • Personal identification
  • Business plan
  • Business financial statements
  • Personal financial statements for all borrowers
  • Business federal tax returns (two to three years for loans more than $100,000)
  • Personal federal tax returns (one to two years for loans more than $100,000)
  • Tax ID number
  • Beneficial owner form for any owner who won’t provide a personal guarantee on the loan and/or for each authorized signer of a non-profit.
  • Entity guarantee form if your business has ownership by another business

Pros/cons

Pros Cons
  Caters to smaller and larger businesses.   Limited information available online.
  One-time financing.   Only operates in 15 states and Washington, D.C.
  Fixed terms.   Collateral required.

Who is the best fit?

TD Bank offers a variety of lending programs for small businesses of varying sizes in operation in the bank’s limited geographic footprint. Businesses that are able to meet the collateral requirements and credit standards – which, like most traditional lenders, are more conservative – would be the best fit for TD Bank loans and lines of credit. The bank also offers financing specifically for health care businesses.


Fine print

The origination fee is waived for borrower’s seeking up to $100,000 for term loans and lines of credit. All lending products require borrowers to maintain an active TD Bank Business Checking account. For existing business checking customers, TD Bank offers a relationship discount on loan pricing.

You are responsible for the appraisal fee if you withdraw your loan application after an appraisal has already been conducted.

If you want detailed information about eligibility requirements, the origination fee for businesses seeking loans and lines of credit exceeding $100,000 and time to funding, you must complete an online form or call a toll-free number to request a callback from a banking specialist.


The bottom line: How do TD Bank business loans stack up

If you live within 90 miles of a branch location, have a good credit rating and access to available collateral, TD Bank may be an option for you. Its Healthcare Practice Solutions Group offers many services that health care professionals could find beneficial. You will need to contact the bank for more specific loan information tailored to your needs before you can compare against other lenders’ offerings.

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