TD Bank Business Loans Review
Janet Schaaf is a freelance writer, editor and proofreader who considers reader advocacy to be her calling. After taking a few roads less traveled, Janet completed a bachelor’s degree in English Literature from the University of Missouri-Kansas City, with English Department Honors. She has been correcting grammar and checking facts since she could string a sentence together. For the past three years, Janet has focused on making personal finance topics understandable and relatable. Loan terms and credit card agreements can look overwhelming, but understanding what you’re agreeing to is paramount in grasping the impact debt can have on your life.
 | Starting rate: Not disclosed Best for: Business owners on the East Coast who prefer to work with a bank, especially an SBA Preferred lender. |
Pros and cons of TD Bank
| Pros | Cons |
|---|---|
SBA Preferred lender No loan limit for first mortgages through SBA 504 loan program Higher-than-average ratings for customer satisfaction in 2022 J.D. Power survey | Requires personal guarantee Loans and lines of credit are generally secured You must apply in person for loans over $250,000 Requires automatic payments from a TD Bank Business Checking account Only available in a few states: Conn., District of Columbia, Del., Fla., Mass., Md., Maine, N.C., N.H., N.J., N.Y., Pa., R.I., S.C., Va. and Vt. |
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TD Bank small business loans review
TD Bank operates in the United States as a subsidiary of the Canadian banking giant, TD Bank Group. It’s the ninth-largest bank in America with over 1,160 locations — quite impressive considering that it only operates in 16 states and territories along the East Coast.
It’s unfortunately tight-lipped about the details of its small business financing products, although it does offer a few of the most popular choices, including business term loans, SBA loans and lines of credit. That’s in addition to its suite of business bank accounts, too.
Who is TD Bank for?
- Established TD Bank Business customers. While not a requirement to apply for a loan, some products — notably the line of credit — require you to have a minimum balance of $40,000 in a TD Bank Business Checking account.
- East Coast business owners. You can only apply for TD Bank business financing if you live in one of these states: Conn., District of Columbia, Del., Fla., Mass., Md., Maine, N.C., N.H., N.J., N.Y., Pa., R.I., S.C., Va. and Vt.
- You prefer working with a bank. There are many online small business lenders, but only a few of them are banks. Getting a business loan from the same place you do your banking can simplify things since everything’ll be done in-house.
TD Bank small business financing at a glance
| Product | Loan amounts | Repayment term | Estimated APR range | Fees |
|---|---|---|---|---|
| Term loan | $10,000 to $1,000,000 | 12 to 60 months | Not disclosed | Not disclosed |
| Line of credit | $25,000 to $500,000 | Not disclosed | Variable: WSJ Prime Rate + 0.74% (currently 5.99% total as of February 2023) | Not disclosed |
| SBA 7(a) loans | Up to $5,000,000 | Up to 300 months | Rates vary, subject to SBA maximums* | Not disclosed |
| SBA 504 loans | No maximum loan amount for first mortgage; up to $5,500,000 for second mortgages | Up to 240 months | About 3.00%* | Not disclosed |
*Terms and rates based on SBA guidelines
Term loans
Some lenders place a big emphasis on parsing their loans out among different types: equipment loans, which are secured by the equipment you’re buying (similar to a car loan), and unsecured loans. TD Bank offers both types but doesn’t distinguish much between the two, only saying that most loans are “typically secured by equipment, inventory or cash.” However, TD Bank offers both short-term business loans and long-term business loans, up to 60 months in length.
Line of credit
TD Bank also generally requires collateral for its business lines of credit, in the form of accounts receivable (similar to accounts receivable financing) or as cash. You’ll also need a TD Bank Business Checking account with a $40,000 minimum balance in order to be approved, unlike for its business loans. You can draw against your line of credit with an online transfer or by writing a check. TD Bank may also offer the option for interest-only payments for a time, so be sure to inquire about your contract if that interests you.
SBA 7(a) loans
As an SBA Preferred lender, TD Bank has more authority to make lending decisions on its own, which results in a faster response for you, the borrower. In 2022, it gave out nearly 4% of all SBA loans, with an average loan size of $116,356. TD Bank requires a 10% minimum down payment with the popular SBA 7(a) loans, and you can use funds for a wide range of purposes including buying equipment, hiring new workers, buying real estate and more.
SBA 504 loans
If you need to make larger purchases, like a significant real estate or equipment investment, TD Bank also offers SBA 504 loans. You can use the property you’re buying as collateral for the loan, and there are no loan limits if you’ll be purchasing your first business property. Like the SBA 7(a) loan, you’ll also be required to make a minimum down payment of 10%.
TD Bank borrower requirements
| Minimum annual revenue | Not disclosed |
| Minimum time in business | Not disclosed |
| Minimum credit score | Not disclosed |
Unfortunately, TD Bank doesn’t provide many of the important details about what requirements you’ll need to meet in order to get approved for a business loan. Typically, you’ll need good credit, a demonstrated track record for your business and a strong income in order to be approved for most business loans.
TD Bank does provide a few details about its business financing requirements, however:
- You’ll need a 10% down payment for SBA loans.
- You’ll need to sign up for autopay for business loans and lines of credit.
- You can apply online for financing amounts under $250,000, but for amounts above that, you’ll need to apply in person.
- You’ll need a TD Bank Checking account with a minimum balance of $40,000 if you’re applying for a business line of credit.
Required documents
TD Bank is pretty open with what documents are required for their business loans. Here are some of the things you’ll need, but keep in mind that depending on your situation, TD Bank might request other documents too:
- Copy of your government-issued ID
- LLC operating agreement, if applicable
- Partnership banking agreement, if applicable
- A copy of the purchase and sales agreement, if you’re buying property
- A copy of the minutes from your business’s last meeting or your bylaws
- Most recent tax return, if you’re requesting a loan between $100,000 and $250,000
- Personal financial statement for any business owners with more than 10% equity in the company
If you’re applying for a loan over $250,000, then you’ll also need a few other things:
- Accounts receivable aging report
- Two most recent years’ worth of personal tax returns
- Three most recent years’ worth of business tax returns
Alternatives to TD Bank
| TD Bank | OnDeck | Capital One | |
|---|---|---|---|
| Minimum credit score | N/A | 625 | Not disclosed |
| Loan products offered |
|
|
|
| Time to funding | Not disclosed | Same day | A few days to a few months |
| Starting APR | Not disclosed | 35.40% | Not disclosed |
| Maximum loan size | No loan limit for first mortgages taken out with an SBA 504 loan | $250,000 | Up to $5,000,000 |
| Minimum annual revenue | N/A | $100,000 | None |
TD Bank vs. OnDeck
OnDeck is a typical online small business lender that offers quick funding (as soon as the same day) but also has significant costs (average APRs for term loans and lines of credit are 62.1% and 48.9%, respectively). However, OnDeck is much more widely available than TD Bank. You can apply online from any state except for Nev., N.D. or S. D., where it doesn’t offer funding.
TD Bank vs. Capital One
If you want to stick with banks, another good choice is Capital One. You can apply for business loans at a branch location, though locations appear to be concentrated in N.Y., N.J., Md., Va., La. and Texas. Capital One actually outranked TD Bank in J.D. Power’s 2022 survey of overall customer satisfaction for small banking, a positive sign of good customer service. Although Capital One is also tight-lipped about its requirements, you’ll need at least two years in business and a business bank account to qualify for its products.