U.S. Bank Business Loans: 2023 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.
Pros and cons of U.S. Bank
| Pros | Cons |
|---|---|
Quick online application for smaller loan amounts with opportunity to apply for larger loans with an appointment 125% equipment financing available Increased maximum loan amounts on SBA 7(a) loans if you’re using the funding for real estate purposes | Rates and business requirements not shared publicly Absence of SBA Express loans from SBA offerings Limited information available on the website |
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U.S. Bank small business loans review
US Bank is a traditional brick-and-mortar bank. In fact, it’s the fifth-largest bank in the country by assets. While it does have online capabilities and applications for smaller loans, it’s highly likely that you’ll need to apply for your small business loan with a live banker in person, over the phone or via a virtual meeting. While US Bank is an SBA preferred lender, there are some holes in its SBA coverage, such as the absence of SBA Express loans.
Who is U.S. Bank for?
- Borrowers who appreciate working with a live agent. Many of US Bank’s lending products require an interview with a live banker.
- Business owners with a decent credit history. As a traditional bank, US Bank is unlikely to be a good option for a bad credit business loan.
- SBA borrowers with modest real estate needs. US Bank allows you to use SBA 7(a) loans for real estate purposes, and is willing to add up to $2,000,000 to the maximum loan amount to allow you to do so. SBA 7(a) loans do not come with balloon payments, unlike some of U.S. Bank’s conventional commercial real estate loans.
U.S. Bank small business financing at a glance
| Product | Loan amounts | Repayment term | Estimated APR range | Fees |
|---|---|---|---|---|
| Unsecured term loans | $5,000-$50,000 | Up to 84 months | Not disclosed | No origination fee |
| Secured term loans | $5,000-$1,000,000 | Up to 84 months | Not disclosed | No origination fee |
| Lines of credit | Up to $1,000,000 | Not applicable | Not disclosed | Not disclosed |
| Equipment financing | Up to $1,000,000 | Starting at 24 months | Not disclosed | Not disclosed |
| Commercial real estate loans | Up to $10,000,000 | 60-180 months, amortization up to 300 months | Not disclosed | Not disclosed |
| SBA 7(a) loans | Up to $5,000,000 | Up to either 84 or 120 months depending on loan purposes | Rates vary, subject to SBA maximums* | Not disclosed |
| SBA 7(a) real estate loans | Up to $7,000,000 | Up to 300 months | Rates vary, subject to SBA maximums* | Not disclosed |
| SBA 504 loans | Up to $12,375,000 | Up to either 120 or 300 months depending on loan purposes | About 3.00%* | Not disclosed |
*Terms and rates based on SBA guidelines
Business term loans
US Bank offers a number of different business term loans. First, there are the term loans you can apply for online, or ‘quick loans’ as they’re dubbed at US Bank. You can get either a secured or unsecured term loan in this manner. The unsecured term loans don’t require collateral. You can borrow anywhere between $5,000 and $50,000 with terms of up to 84 months.
You can also get a secured business loan as quick loans do require collateral, but you’ll get lower rates. You’ll also gain the ability to borrow more – up to $250,000. If you need to borrow even more and have adequate collateral, you can apply for a conventional secured business loan of up to $1,000,000 by making an appointment with a US Bank representative.
Business lines of credit
US Bank offers four different business lines of credit, each with a different maximum borrowing amount:
- Business reserve line: Up to $5,000 to act as overdraft protection on your U.S. Bank business checking account.
- Cash flow manager: Up to $250,000 to manage your business cash flow.
- Business equity line of credit: Up to $500,000 when you put up business real estate as collateral. Terms of up to 60 months.
- Business line of credit: Up to $1,000,000 for materials, equipment or inventory.
You will need to make an appointment with a banker to apply for any line of credit except the cash flow manager. That one can be applied for online. While US Bank does share a max term of 60 months for its business equity line of credit, typically with a line of credit your term acts a lot more like it would on a business credit card. The goal is to pay it off as quickly as possible to avoid paying cumulative interest.
Equipment financing
US Bank offers equipment financing for large business machinery, like commercial vehicles, construction equipment or medical equipment. You can get equipment loans for up to 125% of the costs, which is a fancy way of saying that you get additional funds to cover expenses like installation, taxes and shipping.
If you apply online, you can get up to $200,000 in equipment financing, but you can get up to $1,000,000 if you apply with a banker. Payments are flexible, as they can be made monthly, quarterly, seasonally, semiannually or annually.
Commercial real estate loans
US Bank offers conventional commercial real estate loans that can be used to expand or remodel your existing properties, or to finance multi-unit investment properties. The max you can borrow is $10,000,000, and business loan interest rates can be either fixed or variable. Loan terms can be either 60, 120 or 60 months, but amortization can stretch out over 25 years. This means that if your term ends before amortization, plan to either refinance at the end of your term or get stuck with a large balloon payment.
SBA 7(a) loans
SBA 7(a) loans are backed by the Small Business Administration, and US Bank offers them in two packages. You can borrow up to $5,000,000 if you’re using the SBA 7(a) loan for any of the following purposes:
- Working capital
- Equipment
- Debt refinancing
- Business acquisition
- Tenant improvement
- Partner buyout
If you use the loan to purchase, refinance or build commercial real estate, you may be eligible for US Bank to throw another $2,000,000 on top, for a grand total of up to $7,000,000.
Real estate 7(a) loans can extend up to 300 months. 7(a) loans for working capital and inventory can last up to 84 months, and up to 120 months for all other purposes. There are no balloon payments.
SBA 504/CDC loans
SBA 504 loans are a type of SBA loan specifically for larger real estate purchases. You can also use the funding for refinancing or new construction, which in some cases includes equipment. The max SBA 504/CDC loan amount at US Bank is $12,375,000. Terms on equipment max out at 10 years, while you can borrow over the course of 25 years for all other loan purposes.
Medical practice loans
US Bank offers financing options for dentists, veterinarians and eye care practices. You can secure financing for acquiring or buying into an existing practice, refinancing your current practice, or expanding or relocating your current practice. Terms and other details vary depending on why you need to borrow. For example, terms on refinancing loans can be up to 180 months, while practice expansion loans are capped at 120 months. For all practice loans, you’ll need to apply directly with a banker.
U.S. Bank borrower requirements
| Minimum annual revenue | Not disclosed |
| Minimum time in business | Not disclosed |
| Minimum credit score | Not disclosed |
US Bank is not overly transparent with its business loan requirements. Because it’s a larger, brick-and-mortar bank, it’s safe to assume that those requirements may be higher than they would be with online lenders.
Required documents
When you apply for a business loan with U.S. bank, come prepared with:
- Your business tax returns
- Your personal tax returns
- Financial statements for your business
- Your business’ articles of incorporation
Depending on your application, you may be asked for additional documentation once the process gets started.
Alternatives to U.S. Bank
| U.S. Bank | Bank of America | PNC Bank | |
|---|---|---|---|
| Minimum credit score | Not disclosed | 670 for unsecured lending products, not disclosed for other products | Not disclosed |
| Loan products offered |
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| Starting interest rate | Not disclosed |
| Not disclosed |
| Maximum loan size |
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| Minimum annual revenue | Not disclosed |
| Not disclosed |
U.S. Bank vs. Bank of America
Compared to US Bank, Bank of America offers a wider suite of business financing options. Specifically, they have business auto loans, SBA Express loans, franchise financing and cash-secured lines of credit, all of which are absent at US Bank. Bank of America’s SBA 504 loan maximum is markedly higher at $20,000,000 compared to US Bank’s max loan size of $12,375,000. While Bank of America is far more upfront about its starting rates, that doesn’t necessarily mean they’re lower. The best way to find out would be to inquire with both banks.
U.S. Bank vs. PNC Bank
PNC Bank also offers more business loan products than US Bank. PNC Bank’s additional products include business auto loans, SBA Express loans and SBA Express Export loans. Loan sizes on unsecured term loans are larger at PNC Bank, though both financial institutions are tight lipped about their rates. Applying at both banks would be the best way to determine which is best for your circumstances.