How to get a business loan: 8 steps from need to funding

To get a business loan, start with what the money is for and how much you need, pick the type of financing that fits that need, check your file the way a funder will, gather the documents, then compare offers on total cost in dollars and the payment before you sign. The first two decisions shape everything after them. A $40,000 equipment purchase, a $150,000 expansion and a $25,000 payroll gap point to different products, different paperwork and very different timelines, from a day or two for revenue-based financing to several weeks for an SBA or bank loan.

How to get a business loan in eight steps

Here are the steps to get a business loan, in order.

1. Decide what the money is for, how much you need and how soon you need it.
2. Match that need to the type of financing built for it.
3. Check where your business stands on time in business, deposits, credit and existing debt.
4. Gather the documents the product you chose asks for.
5. Compare offers on total cost in dollars, payment size and frequency, and term.
6. Apply once, through one channel, so you are not stacking credit inquiries.
7. Read the contract and confirm every number before you sign.
8. Use the money as planned and keep the account healthy for the next round.

In the Federal Reserve's 2026 Small Business Credit Survey, 38% of employer firms had applied for a loan, line of credit or merchant cash advance in the prior 12 months, and among those applicants 52% were fully approved, 29% were partly approved and 19% were denied, according to the Fed's 2026 Report on Employer Firms. In other words, four in five applicants got at least some of what they asked for.

1. Decide what the money is for, how much and how soon

Write down the use of funds before you look at a single lender. The same Fed survey found that firms applying for financing most often wanted to meet operating expenses (56%) or to expand, pursue a new opportunity or buy business assets (46%), and those two purposes call for different money. Covering payroll through a slow quarter is a short-term need repaid from the sales that come back, while a new location or a second truck pays off over years and suits a longer term.

Then put a number on it. Price the equipment, get the contractor's quote, or add up the gap between what goes out and what comes in over the months you need to cover. A precise amount with a reason attached reads better to a funder than a round number, and you avoid paying for money you do not use.

Finally, decide how soon you need it. If a supplier discount expires Friday or a job needs materials next week, a product that funds in a day or two is worth more to you than a cheaper one that arrives in two months, and if you can wait, you have more choices.

2. Match the need to the type of financing

Most small business funding falls into four groups, each built for a different job. Our post on the difference between a merchant cash advance and a business loan compares a term loan with revenue-based financing in more depth.

Term loans, SBA loans and bank loans give you a lump sum repaid in fixed monthly installments over several years, at an interest rate. They usually cost the least and suit long-lived purchases, expansions and refinancing, but they need the most paperwork and take weeks to close.

A line of credit gives you a limit you draw from as needed and repay on what you have drawn, often weekly or monthly. It fits uneven cash flow, seasonal inventory and costs you can see coming but cannot time exactly. Offers often come back within a day, and our guide to how a business line of credit works shows what a draw costs.

Revenue-based financing, also called a merchant cash advance, is a purchase of a share of your future sales, paid back as a share of daily or weekly deposits. Funders size it to your bank deposits rather than to collateral or a high score, amounts run from $5,000 to $2,000,000, and most applicants are funded within one to two business days of choosing an offer. It fits owners who need speed or whose credit would hold up a bank loan.

Equipment financing pays for a specific machine, vehicle or tool, and the equipment itself secures the deal, which lets the funder lean less on your score. Offers typically come back in one to two business days, and our guide to how equipment financing works explains how those deals are structured.

3. Check where you stand before you apply

Knowing how to get approved for a business loan mostly comes down to seeing your file the way a funder will, before the funder does. Four things carry most of the weight, and each funder sets its own thresholds for them.

• Time in business tells a funder how much history it has to judge, and more months of steady results make any request easier to place.
• Monthly revenue, read from your business bank deposits, shows how big a payment the business can carry, and funders look at how evenly deposits arrive and how low the balance runs.
• Credit covers your personal score and, if you have one, a business credit file, and a lower score narrows the list of funders rather than closing it.
• Existing debt matters because every loan or advance already taking a payment from the same account reduces what a new funder will offer.

The funders we work with generally look for about a year in business and about $20,000 a month in deposits. If you are not there yet, apply anyway, because some funders work with newer or smaller businesses and we will tell you plainly what is realistic for your file.

The Fed's data puts credit in proportion. Among applicants rated medium or high credit risk (a personal score below 720 or a business score below 80), 70% at online lenders and 66% at finance companies were approved for at least part of what they asked for, compared with 61% at small banks and 54% at large banks. Among applicants who did not get everything they sought, 46% said the lender's requirements were too strict, 37% said they already carried too much debt and 30% pointed to a low credit score. If your score is the weak spot, our guide to getting a merchant cash advance with bad credit covers what those funders weigh instead.

Pull your own credit reports before a funder does. The Consumer Financial Protection Bureau explains that a credit report holds your payment history, account balances, collections and public records such as liens and judgments, and that lenders use it to decide whether to lend and on what terms.

4. Gather your documents

The paperwork depends on the product, which is another reason to choose the product first. Revenue-based financing usually needs a short application and your last four months of business bank statements, and nothing more to get offers. A line of credit or equipment financing may add a quote, an invoice or a bit more financial detail. SBA and bank loans ask for the most, typically business and personal tax returns, financial statements, a personal financial statement, a debt schedule and sometimes a business plan.

Rather than repeat the full checklist here, our guide to small business loan requirements lists what each type of lender asks for, product by product, and how to qualify for a small business loan when your file has gaps. Have everything as digital files before you apply.

5. Compare offers on total cost, payment and term

Line offers up side by side and read the same four numbers on each. Look at the total you will repay in dollars, the cost of the money (total repaid minus the amount you receive), the size and frequency of the payment, and how long the payments run.

Each product states its price differently. Bank, SBA and equipment loans quote an interest rate. Revenue-based financing uses a factor rate, a single multiplier that fixes the total payback before you sign, so the clearest way to read it is in dollars. Our guide to factor rates shows the arithmetic. The figures below are illustrative only, not a quote or an offer, and real terms depend on the funder and on your file.

Offer A and offer B fund just as fast, yet A costs $6,500 less for the same $50,000, which is exactly why it pays to see more than one revenue-based offer. The bank loan costs less again and spreads the payments over three years, and it suits an owner whose credit and paperwork already qualify and who can wait for the money. The right choice is the one whose payment your sales can carry comfortably and whose timing matches your need.

6. Apply once, through one channel

Where and how you apply affects your credit. The CFPB explains that a hard inquiry, the check a lender runs after you apply, can affect your score because scoring models look at how recently and how often you apply, and other lenders can see it, while soft inquiries such as prescreening do not affect your score at all. Five applications sent straight to five lenders can mean five hard pulls.

Applying through us is one short application plus your last four months of business bank statements, uploaded or shared through a read-only bank connection. Getting matched does not need a hard credit pull, because most funders prequalify from bank statements and a soft pull. Your file goes to the funders in our network that fit your business, offers come back side by side, and there is nothing to pay to apply or to see offers. If the funder whose offer you choose runs a hard pull in final underwriting, you know before it happens. Most revenue-based applicants are funded within one to two business days of choosing an offer, while SBA and bank loans take weeks. Our post on what happens between application and funding walks through each stage.

7. Review the contract and sign

Before you sign, check the contract against the offer you chose. Confirm the amount you will actually receive after any fees taken at funding, the total you will repay, and the payment amount and schedule. For revenue-based financing, look at the purchased amount, the factor rate, the share of receivables the payment is based on and whether the agreement allows a reconciliation if your sales fall. Ask what happens if you pay early, since some funders discount an early payoff and some do not.

Also look for anything that reaches beyond the business account, such as a personal guarantee, a lien on business assets or a limit on taking other financing while the balance is open. These terms are common, and you should know they are there before you sign. Our team goes through every offer with you, so if a number does not match what you were shown, ask before you sign.

8. After the money lands

Put the money to the use you planned in step one and keep a simple record of where it went. Keep enough of a cushion in the account to cover the payment on slower days. If sales slip, call the funder early, before a payment bounces.

This round also sets up the next one. Steady deposits, on-time payments and a balance that stays well above zero make your next application stronger, whether that is a line of credit, equipment financing or a second round once the first is paid down.

Start the application with your last four months of bank statements on hand, or call us at (818) 351-0225 to talk through what you need before you apply.

Questions about getting a business loan

How hard is it to get a business loan?

It depends mostly on the product and on how well your file fits it. In the Federal Reserve's 2026 Small Business Credit Survey, 52% of applicants for loans, lines of credit and merchant cash advances were fully approved and 19% were denied, and denial rates ranged from 11% for auto and equipment loans and 12% for merchant cash advances to 40% for SBA loans and lines, so choosing a product that suits your business does a lot of the work for you.

What credit score do you need for a business loan?

There is no single minimum, because every funder sets its own and they vary widely. Banks and SBA lenders lean hardest on credit, while revenue-based funders weigh your bank deposits more, and the Fed's survey found that even among applicants rated medium or high credit risk (for example a personal score below 720), 70% at online lenders and 54% at large banks were approved for at least part of what they sought.

Is it hard to get a $50,000 business loan?

Whether $50,000 is within reach depends on your deposits, time in business and existing debt more than on the number itself. For a revenue-based offer the amount is sized to your deposits, so the closer the request is to what your sales can comfortably repay, the easier it is to place, and very young businesses can also look at SBA microloans, which go up to $50,000 through nonprofit lenders and average about $13,000.

Can I get a business loan with no credit?

Yes, a business with no credit history of its own can often get funded, because funders look at the owner's personal credit and the business bank account instead, and revenue-based funders give the deposits the most weight. Our guide to business loans with no credit check explains what funders review when credit counts for less and how soft and hard pulls differ.

How long does it take to get a business loan?

Revenue-based financing is the fastest, with most applicants funded within one to two business days of choosing an offer and some the same day, and line of credit offers often come back within a day. SBA and bank loans take weeks because of the tax returns, personal financial statement and debt schedule they require, and in the Fed's survey 21% of large bank applicants reported a long wait for a credit decision or funding, compared with 8% at online lenders.