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Wells Fargo Small Business Loans Review

APR range: 8.00% to 9.25% Based on the current prime rate of 7.50% + an added 0.50% to 9.75% from Wells Fargo   Loan amounts: $5,000 to $15,000,000   Our Verdict: Wells Fargo’s borrowing limits are low compared to competitors — but that doesn’t necessarily mean underwriting criteria like minimum credit score or annual revenue requirements are lower to match. That being said, its interest rates can be competitive, especially for larger companies. See Business Loan Offers

Pros and cons of Wells Fargo

Wells Fargo small business loans review

Wells Fargo is a traditional brick-and-mortar bank — the fourth largest in the nation. Despite its size, it offers relatively few small business loan options. It offers conventional secured and unsecured lines of credit, an SBA line of credit, SBA 7(a) and SBA 504/CDC loans.

You’ll find more conventional and SBA lending products at other large, national banks, but the handful of SBA options that Wells Fargo does provide gives you more variety than you’d find at an online lender.

Wells Fargo small business financing at a glance

Product	Loan amounts	Repayment term	Estimated APR range	Fees
Secured line of credit (Prime Line)	$100,000 to $1,000,000	12-month revolving term	Starting at 8.00% Based on the current prime rate of 7.50% + an added 0.50% from Wells Fargo, subject to a 5.00% minimum	0.50% origination fee, due on an annual basis
Unsecured line of credit (BusinessLine)	$10,000 to $150,000	Revolving	9.25% to 17.25% Based on the current prime rate of 7.50% + an added 1.75% to 9.75 from Wells Fargo	Annual fee of $95 or $175, waived for the first year 0% to 4% cash advance fee Late fee of $25, $39 or $50
SBA line of credit (Small Business Advantage)	$5,000 to $50,000	60-month revolving term	12.00% to 14.00% Based on the current prime rate of 7.50% + an added 4.50% to 6.50% from Wells Fargo	No annual fee Wire transfer fee of the greater of $10 or 4% Late fee of $25, $39 or $50
SBA 7(a) loans	Up to $5,000,000	Up to 300 months for commercial real estate purposes Up to 120 months for all other purposes	10.50% variable, 12.50% fixed Some borrowers may qualify for lower rates. Based on the current prime rate of 7.50% + a rate maximum set by the SBA.	Not disclosed
SBA 504 loans	Up to $15,000,000	Up to 300 months for commercial real estate Up to 120 months for machinery or equipment	About 3.00% Based on SBA guidelines	Not disclosed

Prime Line secured line of credit

The Wells Fargo Prime Line is a secured business line of credit, which means you’ll have to put up collateral. You can use any of the following as collateral:

While it’s a revolving credit line, it does require an annual review every 12 months for renewal. There is a 0.50% origination fee you’ll have to pay when you initially open your credit line and at renewal every year, but there are no cash advance fees.

BusinessLine unsecured line of credit

BusinessLine is Wells Fargo’s conventional unsecured line of credit. While you won’t need collateral, you will need to provide a personal guarantee. You’ll need a guarantee from an owner or owners whose aggregate interest in the company is at least 51%. Each eligible owner must own at least 25% interest in the company by themselves in order to qualify. If you want an unsecured loan, you’ll be funneled towards the BusinessLine if you’ve been in business for at least two years.

Interest rates are based on the current prime rate (7.50%) and range from the prime rate + 1.75% to the prime rate + 9.75. There is an annual fee on this line of credit. If your credit line is $10,000 to $25,000, the annual fee is $95. If your credit limit is $25,000 to $150,000, the fee jumps up to $175. The fees don’t end there — you’ll also need to account for cash advance fees and late fees. Cash advance fees vary depending on circumstance:

Late fees are also different depending on your situation. You’ll pay either $25, $39 or $50.

Late Fee	Circumstance
$25	You pay late, but the balance on your previous statement was less than $100.
$39	You pay late, but the balance on your previous statement was $100 or more.
$50	You pay late, and you’ve been delinquent at least twice over the past 12 billing cycles.

Small Business Advantage unsecured line of credit

If you’ve been in business for fewer than two years, Wells Fargo may offer you a Small Business Advantage unsecured line of credit, backed by the SBA. The credit line limits are lower for the SBA line of credit, ranging from $5,000 to $50,000, and the interest rates start higher, ranging from the prime rate + 4.50% to the prime rate + 6.50% depending on your creditworthiness. On the plus side, there are no annual fees, and your revolving line of credit will only undergo a review once every five years.

Another positive is that there are fewer cash advance fees on the Small Business Advantage line of credit. You’ll only pay wire transfer fees or fees for using your Business Advantage Mastercard to purchase Casino Cash or Quasi Cash. In that instance, the fees will be the greater of 4% or $10. The late fees are identical to those on the BusinessLine line of credit.

You will still need to provide a personal guarantee even though no collateral is required. For the Small Business Advantage line of credit, each owner providing a guarantee must have at least 20% interest, with all signing owners collectively holding 51% interest in the company or more.

SBA 7(a) loans

SBA 7(a) loans are term loans that can be used for a number of different purposes. Wells Fargo outlines common uses of its SBA 7(a) loans in particular as:

The maximum amount you can borrow is $5,000,000. Terms can be as long as 300 months (or 25 years) if you’re using the loan for commercial real estate. Otherwise, the max term is 120 months (10 years). Rates can be either fixed or variable, and are subject to SBA interest rate maximums. The SBA does charge fees to banks when it issues these loans, and it is highly likely that you will see Wells Fargo pass these fees on to you as the borrower, though Wells Fargo does not publicly disclose fees for SBA products.

SBA 504/CDC loans

SBA 504 loans are built for construction or real estate purposes. At Wells Fargo, you can use them for construction or buying equipment, land or property. The amount you can borrow varies by your intended use. Wells Fargo will back up to the first $10 million; then another $5 million can be provided by a Certified Development Company. However, if you’re a small manufacturer or working on an energy project, you may be eligible for a max of $5.5 million from the Certified Development Company.

Rates are set by the SBA, and are currently around 3.00%. Maximum loan terms are 120 months (10 years) for machinery or equipment purchases. The max jumps up to 300 months (25 years) if you’re using the funding for construction or other commercial real estate endeavors. Once again, this is one product where you’re likely to see SBA fees passed on to you as the borrower, but those fees are not disclosed before application.

Healthcare practice loans

If you run a healthcare practice, Wells Fargo does offer a large suite of lending products to meet your financing needs. Healthcare lending products include:

Wells Fargo borrower requirements

Minimum annual revenue	$2,000,000 for Prime Line secured line of credit Not disclosed for other products
Minimum time in business	2 years for conventional lines of credit Not disclosed for other products
Minimum credit score	680 for unsecured lines of credit Not disclosed for other products

Wells Fargo shares glimpses of its underwriting requirements, but it’s hard to get a full picture for any particular product. Let’s take a look at the information it does provide for how to get a business loan and line of credit.

Unsecured line of credit borrower requirements

For BusinessLine or Small Business Advantage lines of credit, you typically need a credit score of at least 680 to qualify. If you’ve been in business for two years or more, you’ll be eligible to apply for the BusinessLine product, but if you’re a newer business with fewer than two years under your belt you’re better suited for the Small Business Advantage line of credit. Annual revenue requirements are not disclosed for these products.

Prime Line secured line of credit borrower requirements

Minimum credit score requirements are not disclosed for this product, and minimum time in business requirements are presumably two years, as you will be asked for your past two years of business tax returns when you apply. Wells Fargo does share that most qualifying businesses have annual sales between $2 million and $10 million.

SBA loan borrower requirements

Wells Fargo doesn’t publicly share many minimum requirements for SBA 7(a) and 504/CDC loans, but minimum SBA loan credit requirements set at the national level are a good place to start your research. Wells Fargo does share some maximum limitations for SBA term loan borrowers, though. Your business’ net worth is expected to be under $15 million, and the average net income should be below $5 million.

Required documents

When you apply for a Wells Fargo business line of credit, you’ll need to provide the following information:

If you’re applying for a Prime Line secured line of credit, you will also need to provide:

Alternatives to Wells Fargo

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	Wells Fargo	Bluevine	American Express Business Line of Credit
Minimum credit score	680 for unsecured lines of credit Not disclosed for other lending products	625	660
Loan products offered	Secured line of credit Unsecured line of credit SBA unsecured line of credit SBA 7(a) loan SBA 504/CDC loan	Unsecured line of credit	Unsecured line of credit
Starting interest rate	8.00% for secured lines of credit Based on the current prime rate of 7.50% + an added 0.50% from Wells Fargo, subject to a 5.00% minimum 9.25% for Business Line unsecured lines of credit Based on the current prime rate of 7.50% + an added 1.75% from Wells Fargo 12.00% for SBA unsecured lines of credit Based on the current prime rate of 7.50% + an added 4.50% from Wells Fargo	7.80%	3.00% to 27.00% 3% to 9% for 6-month terms 6% to 18% for 12-month terms 9% to 27% for 18-month terms 12% to 18% for 24-month terms
Maximum loan size	$1,000,000 for secured lines of credit $150,000 for unsecured lines of credit $50,000 for SBA unsecured lines of credit $5,000,000 for SBA 7(a) loans $15,000,000 for SBA 504 loans	$250,000	$250,000
Minimum annual revenue	$2,000,000 for secured lines of credit Not disclosed for other lending products	$50,000 for 3-month repayment plans $120,000 for 6- or 12-month repayment plans	$36,000
Minimum time in business	2 years for conventional lines of credit Not disclosed for SBA lending products	6 months for three-month repayment plans 1 year for 6- or 12-month repayment plans	12 months

Wells Fargo vs. Bluevine

While Wells Fargo does offer SBA products, its primary small business lending products are its business lines of credit. Bluevine’s only lending product is its business line of credit, which comes with lower minimum credit score requirements than Wells Fargo. Bluevine’s line of credit is unsecured, and when compared to Well Fargo’s unsecured lines of credit, you can borrow more through Bluevine.

Wells Fargo vs. American Express Business Line of Credit

The American Express Business Line of Credit is a bit easier to qualify for than Wells Fargo’s unsecured lines of credit, as the minimum credit score is 20 points lower. It also comes with a much lower barrier to entry when it comes to minimum annual revenue requirements. You only need to have been in business for half the time required by Wells Fargo for its conventional unsecured line of credit, and you can borrow up to $100,000 more. However, you won’t be able to get SBA loans like you could through Wells Fargo.