Up to $250,000
7.80%
6 or 12 months
625
12 months
If you need flexible funding in addition to funds for debt consolidation, a business line of credit may be a better choice than a term loan since it allows you to borrow against it as needed. In particular, we chose Bluevine as our best line of credit pick because it accepts borrowers with fair credit scores and boasts a low minimum interest rate. That said, your business will need to be bringing in at least $10,000 in monthly revenue to qualify and you’ll be subject to relatively short repayment terms.
$5,000 - $1,500,000
1.10
4 to 18 months
570
6 months
Fora Financial is our top pick for borrowers with bad credit because the lender accepts credit scores as low as 570. In addition, you’ll have the opportunity to be approved for up to $1,500,000 in funds and you’ll only need to be able to show a minimum of six months in business in order to qualify for a loan. Still, Fora Financial’s annual revenue requirement is fairly steep at $15,000 per month and the company does charge a 3.00% origination fee.
$25,000 - $500,000
15.22%
6 to 84 months
660
24 months
Funding Circle is our choice for the best lender for low-revenue businesses because its annual revenue requirement is only $50,000, which is much lower than some of its competitors. Plus, its loan terms range up to seven years, which makes it a solid option for a long-term business loan. However, since its minimum credit score requirement is 660, you could have trouble being approved with poor credit. You’ll also likely pay more for the privilege of borrowing with a lower score since its interest rates extend to 45.00%.
$5,000 - $250,000
27.30%*
Up to 24 months
625
12 months
OnDeck is the standout choice for those looking for fast funding because you may be able to receive your financing the very same day your application is approved. Its shorter time in business requirement and lower minimum loan amount of just $5,000 may also be of benefit. Yet, since OnDeck only offers a short-term business loan, you’ll have to deal with some limitations. For one, repayment terms only go up to 24 months. For another, you’ll have to plan for daily or weekly payments.
Up to $5,000,000
Base plus 3.00%
Up to 120 months
No minimum (680 recommended)
24 months
The U.S. Small Business Administration (SBA) is our top choice for borrowers seeking to consolidate larger loan amounts. Since the SBA guarantees these loans, lenders are able to offer more generous loan terms, such as larger loan amounts and longer repayment periods. At the same time, though, funding times can be much longer with these loans and for loans $50,000 or higher, you’ll have to put up collateral to secure the financing.
$20,000 - $500,000
8.49%
Up to 144 months
750
24 months
BHG Money’s business debt consolidation loan terms extend up to 144 months, which is why it’s our best choice for borrowers who need more time to pay off their loans. Combined with its larger loan amounts and lack of a personal collateral requirement, this lender is set to be a solid pick for those who can qualify for its loans. However, you may have a hard time figuring out if you can qualify in the first place. BHG Money doesn’t publish all of its qualifying requirements online and some of them, like its $1 million annual revenue requirement, may be hard for some small business owners to meet.
A business debt consolidation loan replaces all your existing debt into one loan with one monthly payment.
Consolidating business debt could help your business save money and free up cash flow. You could potentially lower your interest rate or get more manageable payments.
Yes, it’s possible to consolidate your business debt using a business debt consolidation loan or balance transfer credit card. Many small business loans can be used for debt consolidation purposes, but some lenders don’t allow it. With that in mind, you’ll want to be sure to check in with your preferred lender about any use restrictions before you apply.
There’s no one-size-fits-all answer to whether business debt consolidation makes sense. In general, if you’re hoping to streamline your finances and you can find a loan with decent terms, it may make sense to consolidate business debt. However, consolidation doesn’t erase what you owe – it just allows you to restructure your debt into a more manageable payment. If you are close to paying off your existing debts or you can’t find a loan with favorable terms, consolidating may not be the best idea.
Any time you open or close a loan or credit card, it can temporarily ding your credit score. That said, the good news is that, as long as you continually make your payments on time, taking out a consolidation loan can actually help you build your credit score over time.
