Need quick business funding? Here’s what you need to know about fast business loans
Do you have damaged equipment that needs replacement? Need to purchase inventory and you have not yet received payment from customers? Or you have a new client but do not have enough cash to commit to a new contract? These are a few of the difficult situations which business owners may find themselves in that will not only reduce the business profits, but you could also be missing out of an important business opportunity. If you are in such a situation and need funding in a matter of a few days or weeks, fast business loans can be convenient for you. The good news is that you don’t have to make long bank queues with demanding paperwork procedures to access business loans. Thanks to online lenders, you can easily access a business loan to meet your immediate financial needs in as soon as soon as 10 minutes. As much as bank loans come with affordable rates, it can take several weeks to receive the funds and this can inconvenience a business owner.
Who needs fast business loans?
If you own a business, you may at one point experience cash shortage to cover for immediate business expenses. Such expenses include replacing a broken equipment or purchase of extra materials to meet a large order. Sometimes, you may even require funds within a few days to make payroll. Fortunately, alternative lenders provide fast business loans with approval rate of less than 24 hours.
7 fast business loans for immediate funding
- Quick working capital business loans
Businesses use working capital loans for different purposes including paying for operating expenses or taking new business opportunities. You can borrow working capital loans ranging from $2,500 to $250,000 with loan terms of between 3 and 18 months. The loans are specifically designed to meet short-term business needs. The interest rates also vary depending on the lender and your creditworthiness. Most lenders offer the loan with 7%-99% interest rate. One advantage of working capital loans is that you can receive funding within 48 hours. Again, there is less paperwork involved in working capital loan application and businesses with poor credit can also qualify for funding. You may not be required to provide collateral; however, most lenders will need you to pay the loan on a daily basis. If you have negative working capital, a working capital loan is among the best way to access fast business loans.
- Business line of credit
If you need fast business funding, you can also consider a business line of credit. With a line of credit, you will be able to access capital as soon as the need arises.What makes lines of credit stand out from other lending options is that you only pay interest on the amount you withdraw and not on the principal amount. However, your line of credit can be closed or reduced at any time. With this borrowing option, you can receive easy business loans ranging from $10,000 to $1M. The loan term falls between 6 months and 5 years with interest rates of 7%-25%.
- Short-term business loans
Short-term business loans provide a lump sum amount that needs to be paid within 3-18 months. The funds can be approved within 48 hours. However, the loans, just like credit cards, can be expensive. Alternative lenders provide short-term loans from $2,500 to $250,000 depending on your creditworthiness, annual revenue and years of operation.
- Equipment loans
Equipment financing can be a good loan option when you work in healthcare, construction and other industries that use heavy equipment. With equipment loans, you can receive funding within 2 hours. Suppose your storage tanks are destroyed by natural disasters, you might want to take care of the situation before losing some of your customers. But repair or purchase of such equipment can be expensive and cannot be paid by the business cash flow. With an equipment loan, you can have your business operate normally again. To access an equipment loan, lenders may require a down payment of between 10% and 20%. But you can still find lenders who offer 100% financing. The repayment term varies depending on the equipment estimated life. With heavy equipment, the term can be as long as 7 years. Interest rates range from 8% to 30% per year. Collateral for the loan is the equipment itself. Since the loans are risky, it is prudent to avoid lenders who require your personal home or a savings account as collateral.
- Invoice financing
With invoice financing, you can sell your unpaid customer invoices to a factoring receivables company which in turn provides an advance rate of 70%-90% of your invoice value. Once the customer pays the invoice, the company forwards the remaining percentage less the factoring or discount fee. The invoices act as collateral for the loan and if the customer defaults, the business buys back the invoices from the factoring company (this is referred to as recourse factoring). If you cancel the services, you might also be charged an additional fee. Discount rates depend on the factoring company, most of them charging a fee of 1% per week.
- Merchant cash advance
With merchant cash advances, the business sells a percentage of its projected revenues to a lending company in exchange for funds to meet their short-term financial expenses. Lenders provide an advance rate of $2,500-$250,000, which is received almost immediately. Rather than interest rates, a factor rate ranging from 1.14-1.18 is charged. Most lenders also consider your credit score before advancing the money.
- Personal loans for business
Personal loans for business can make a good choice if you need immediate funding, and especially if you have a good credit score since you may qualify for affordable rates. But if you have poor credit, you may not qualify for the loan, even if you do, you may be charged a high interest. Businesses can borrow up to $100,000. The loans have a repayment period of up to 7 years and attract an APR of up to 4.36%.
Comparing the best small business loans with quick approval
Kabbage provides small business loans for amounts up to $250,000. The loan application is done online, and the process takes only a few minutes to complete. Businesses can also receive funding within a few business days. To qualify for the loan, your business should be in operation for more than a year and generate annual revenue of at least $50,000. The loan attracts an APR of between 24% and 99% and has a term of 6 or 12 months.
QuarterSpot also provides quick business loans for amounts between $5,000 and $200,000. The loan has an APR of 30%-70% with a loan term of 9, 12 or 18 months. The funds can be approved within 24 hours.
FundBox provides lines of credit for amounts up to $100,000. You can receive funds as soon as the next business day. To qualify, your business should have minimum annual revenue of $, 50,000 and should be in operation for at least 3 months. The loan attracts an APR of 10.1%-79.8% with a term of 12 weeks. Businesses can receive funding within 24 hours.
If you have been in business for less than one year, StreetShares can be a good financing solution. StreetShares provides term loans of $2000-$250000, invoice factoring up to $2M and standard line of credit of $5,000-$250,000. You can receive funds within 5 days after application. The company also requires a personal credit score of 600+ and annual revenue of more than $75,000. The loan attracts an APR of 9%-40% with a loan term of 3 to 36 months.
With this lending option, funds can be approved in less than 24 hours. The company provides online small business loans of $5,000-$500,000 with an APR of 16.7% to 99.4%. To qualify, you should have a credit score of 500+, be in business for at least one year with minimum annual revenue of $100,000. With OnDeck term loans, the funds should be repaid on a daily or weekly basis.
With LendingClub, you can receive funding within 2 weeks. The loan amount ranges from $5,000 to $300,000 and has an APR of 9.8%-35.7%. The loan term is between 1 and 5 years. To qualify, you should have a personal credit score of 600+and minimum annual revenue of $50,000
- Credibility Capital
If you take a business loan at Credibility Capital, the funds can be sent to your bank account in as soon as 3 days. The company provides quick business loans of $100,000-$350,000 with an APR of 10%-25%. The loan has a term of 1, 2 or 3 years. Your business should be at least 18 months old and a personal credit score of 650+ is also required. Additionally, the business should have minimum annual revenue of $150,000.
Many small business owners rely on borrowed funds to achieve business growth among other uses. As much as traditional bank loans can also work for businesses, there are instances where you will require urgent funding like when you want to solve a business emergency. Fortunately, many alternative lenders provide fast business loans with approval time of 1 or 2 hours. This can help fill a financial gap rather than waiting for weeks to have your business loan approved in traditional financial institutions. There are also lenders who are willing to provide instant business loans to business owners with poor credit or low annual revenue, making them a good solution to both startups and established businesses.