Business term loan
Business Term Loans: One Lump Sum, One Fixed Schedule
A business term loan gives you a lump sum of $20,000 to $5,000,000 at a fixed rate, repaid on a set schedule over six months to three years, with funds in as few as 48 to 72 hours. RAN Funding compares offers from bank, SBA and online lenders in one application and tells you which one fits before you commit.
What Is a Business Term Loan?
A business term loan is a lump sum repaid in fixed installments over a defined term. Through RAN Funding, amounts run from $20,000 to $5,000,000, terms from 6 months to 3 years (longer through SBA), rates from roughly 7% to 30% depending on credit, revenue and time in business, and funding in 48 to 72 hours for most online offers. Unlike a line of credit, you receive the full amount up front and cannot redraw; unlike a merchant cash advance, the payment is fixed and does not move with your sales. RAN Funding is a broker, not a lender: the funding partner sets eligibility, amount, rate, fees and the funding date.
Capital You Can Plan Around
A term loan is the right shape for a single, planned investment. You know the cost of the build-out, the second location or the equipment; the loan matches it with a payment you can put in the budget and forget about. Longer terms and lower rates reward an established track record, and strong files often get offers from several lenders at once.
Because we place term loans with banks, SBA lenders and online lenders alike, we can show you the cheapest offer your file supports and the fastest one, and tell you honestly whether a line of credit or equipment financing would serve the purpose better.
What to Have Ready Before You Apply
Documents required
- Last 3 to 6 months of business bank statements
- Most recent business tax return (2 years for offers over $250,000)
- Year-to-date profit and loss statement and balance sheet
- Business debt schedule, if you carry other financing
- Voided business check and driver’s license
Typical partner screening criteria
- 12+ months in business (6 months for smaller amounts)
- $250,000+ in annual revenue; $100,000+ for loans under $50,000
- Personal credit score of 600+; 680+ for bank pricing
- No open bankruptcies or unpaid tax liens
- Few or no overdrafts in the last 90 days
Ready to See Your Options?
No obligation and a soft inquiry to check. A funding specialist comes back with the offers you qualify for.
The Complete Guide to Business Term Loans
How a Business Term Loan Works
You apply once, a specialist reviews your bank statements and credit, and lenders in our network return offers with a loan amount, rate, term and payment. You pick one, sign electronically, and funds arrive by wire or ACH. Repayment is automatic on the schedule in the agreement, weekly or monthly, until the balance is paid. Most online term loans have no collateral beyond a blanket UCC lien and a personal guarantee; bank and SBA term loans may require specific collateral.
Business term loan timeline
Typical timeline for online lenders. Bank term loans take 2 to 4 weeks; SBA term loans 30 to 60 days.
Payments are fixed, which is the product’s main advantage over revenue-based financing and merchant cash advances. Many lenders also report to business credit bureaus, so a term loan paid on time builds your company’s credit file for the next round.
Business Term Loan Rates in 2026
Rates depend on who lends and how the file looks. With Prime at 7.00%, the ranges across our lender network:
| Lender type | Typical APR | Term | Time to fund | Best for |
|---|---|---|---|---|
| Bank | 7–11% | 1–5 years | 2–4 weeks | 2+ years in business, 680+ credit, clean financials |
| SBA 7(a) | 10–13.5% | Up to 10 years | 30–60 days | Larger amounts and the longest terms |
| Online lender, strong file | 12–20% | 6–36 months | 48–72 hours | 12+ months in business, 660+ credit |
| Online lender, fair credit | 20–30%+ | 6–24 months | 24–72 hours | 600–659 credit or under a year in business |
Some online lenders quote a “simple interest” or “factor” instead of an APR. A 1.15 factor on a 12-month term is roughly 28% APR; on a 6-month term it is closer to 50%. Ask for the APR and the total payback in writing and compare offers on total dollars, not the headline number. Our guide to factor rate vs APR walks through the math.
Typical APR by lender type, October 2026
Ranges across the RAN Funding lender network. Individual offers depend on revenue, credit, time in business and existing debt.
What a Term Loan Costs: A Worked Example
| $100,000 at 12% for 24 months | $100,000 at 20% for 18 months | $100,000 at 1.18 factor, 12 months | |
|---|---|---|---|
| Monthly payment | $4,707 | $6,407 | $9,833 |
| Total repaid | $112,976 | $115,320 | $118,000 |
| Total cost | $12,976 | $15,320 | $18,000 |
| Approximate APR | 12% | 20% | ~33% |
The shortest loan is not the cheapest. Match the term to how long the investment takes to pay for itself: a build-out that lifts revenue for years can carry a 36-month term; inventory that sells in 90 days should not. Our loan payment calculator shows the payment and total cost for any combination.
What Business Owners Use Term Loans For
- Expansion and build-outs: a second location, a kitchen remodel, a new bay or production line.
- Large equipment when you want the loan separate from the asset; otherwise see equipment financing.
- Buying out a partner or a competitor at amounts an SBA loan would take too long to fund.
- Refinancing expensive short-term debt into one fixed monthly payment.
- Hiring and marketing ahead of growth with a known cost and a known payback period.
- Bridging to an SBA loan: fund now, refinance into a 10-year SBA term later.
Term Loan vs Line of Credit vs SBA vs Revenue-Based
| Term loan | Line of credit | SBA 7(a) | Revenue-based financing | |
|---|---|---|---|---|
| Structure | Lump sum, fixed payments | Revolving; draw and repay | Lump sum, long amortization | Lump sum, payments tied to sales |
| Amount | $20K–$5M | $10K–$2M | $50K–$5M | $10K–$1M |
| Term | 6–36 months | 12–24 months, renewable | Up to 10–25 years | 3–18 months |
| Rate | 7–30% | 8–60%+ | 10–13.5% | Factor 1.1–1.5 |
| Credit | 600+ | 640+ | 680+ | 550+ |
| Speed | 48–72 hours | 48–72 hours | 30–60 days | 24–72 hours |
| Best for | One planned investment | Recurring cash-flow gaps | Largest, longest, cheapest | Fast capital with weaker credit |
Detailed comparisons: term loan vs line of credit, SBA loan vs term loan, and term loan vs line vs revenue-based at $250K+.
How to Qualify for the Best Offer
Four things move a term-loan offer more than anything else: time in business, revenue consistency, personal credit and existing debt. Before you apply:
- Clean up the last three bank statements. No overdrafts, no returned payments, a steady balance.
- Pay down revolving credit under 30% of limits. A 20-point score bump can move you a full pricing tier.
- Pay off or consolidate daily-pay advances. Stacked MCAs are the most common reason for a decline or a high rate; see reverse consolidation.
- Have your tax return and year-to-date P&L ready. Offers over $250,000 almost always require them.
- Apply once, through one channel. One application to our lender network means one soft pull instead of five hard ones.
When a Term Loan Is Not the Right Tool
A term loan is the wrong shape for a recurring cash-flow gap, because you pay interest on the full amount whether you need it that month or not; a line of credit fits better. It is also the wrong tool when the purchase is a titled asset with a long useful life, where equipment financing gives a longer term at a lower rate, and when you need a 10-year amortization on a large amount, where an SBA loan is cheaper if you can wait. Under six months in business or below 550 credit, revenue-based financing is usually the realistic path.
One Lump Sum, One Fixed Schedule
A term loan is the right shape for a single, planned investment where you want a payment you can put in the budget and forget about. A specialist tells you up front which lenders fit your file and what the fixed payment will be.
- From $20,000. Up to $5 million for established businesses with strong financials.
- Three months of statements. Your last three business bank statements to start; tax returns above $250,000.
- One specialist. The same person from application to funding, paid by the funder, not by you.
Go Deeper on Business Term Loans
Comparisons and how-tos for owners deciding between a term loan and the alternatives.
Business Term Loan Questions, Answered
What is a business term loan?
A lump sum repaid in fixed installments over a set term, typically 6 months to 3 years through online lenders and up to 10 years through banks and SBA. Through RAN Funding, amounts run from $20,000 to $5 million.
How fast can I get a business term loan?
Most online offers fund in 48 to 72 hours after a complete application. Bank term loans take two to four weeks and SBA term loans 30 to 60 days.
What credit score do I need?
Most online lenders require 600 or higher; banks and SBA lenders generally require 680 or higher. Below 600, revenue-based financing is usually the realistic option.
What interest rate can I expect?
Roughly 7% to 11% at banks, 10% to 13.5% through SBA, 12% to 20% from online lenders for strong files and 20% to 30% or more for fair credit. Ask for the APR and total payback in writing.
Is collateral required?
Online term loans usually require only a blanket UCC lien and a personal guarantee. Bank and SBA term loans may require specific collateral, especially above $350,000.
Can I pay a term loan off early?
Often, but check the agreement. Some lenders reduce the interest when you prepay; others charge a fixed amount regardless. Ask for a written payoff calculation before signing.
What should I compare between offers?
Net funds received, APR, all fees, total repayment, payment frequency, term, collateral and the personal guarantee. Two offers with the same “rate” can differ by thousands of dollars in total cost.
Is RAN Funding the lender?
No. RAN Funding is a business financing broker. We compare offers from our lender network and the funding partner determines eligibility, amount, rate, fees, term and funding date.
See our application preparation guide and broker and compensation disclosure. Approval and terms depend on the funding partner. Rate ranges are typical of offers in the RAN Funding lender network as of October 2026 and are not an offer of credit. Reviewed 14 October 2026.