How to Get a Stated Income Business Loan?

Business Guides

Jacques Famy Jr
Review By Todd Millman

A "stated income" business line of credit is a form of REDUCED documentation loans (not a NO Documentation Line of Credit). Unlike a term loan that provides a lump sum upfront, a line of credit is more flexible in that you have a pool of funds that you can draw on it as you need up to a credit limit. This stated income business lines usually has an interest rate and you are only responsible for paying interest on the current balance once payments are due. Rates and costs due vary depending on credit and qualifications.

How Does Stated Income Business Lines of Credit Work?

What’s different about stated income business credit line is that income is not verified and merely stated. This DOES NOT mean that revenue is not checked, it means just the profit & loss is not viewed. These kinds of lending products, such as a line of credit, stand out from traditional business lines of credit because their lender requirements do not necessitate an exhaustive list of financial documents. These usually include tax returns or profit & loss statements, along with other income-related supporting documentation. Instead, they are replaced by simpler prerequisites.

Business bank statements, for instance, will be required, as they form a part of the key borrower information. A stated income business line of credit, considering the inherent lending risk such as taxes and maintenance fees, is a remarkable option for aspiring entrepreneurs who need quick and easy access to cash flow. These lines of credit can also assist in managing the company's highest expenses such as taxes and payroll.

Stated Income Business Lines of Credit with No Income Verification Qualifications

Minimum qualifications typically are:

  • 2 years in business (No Startup Businesses)
  • Credit Approval: Business Owner Personal Credit score above 620 to extend credit
  • $200,000 in annual revenue
  • Most Business types/Industries accepted (some restrictions)
  • Business Bank Statements
  • Merchant processing statements (if applicable)
  • No personal collateral required

Surely, you may have certain facts about the entire process. Rest assured, by meeting these criteria, you'll improve your chances of securing the line of credit, potentially at favorable rates and terms.

What is Needed to Apply for a Stated Income Business Line of Credit?

There are only a few documents you may need to apply and be qualified for a stated income business line of credit. These include but are not limited to*:

Stated Income Business Lines of Credit Product Overview

  • Interest Rates: Interest rates or Factor rates (vary depending on credit, time in business)
  • Repayment Terms: Repayment period (6 to 12 months)
  • Fees: Origination Fees 0% to 3%
  • Payments: Monthly, Bi-Weekly, Weekly
  • Credit Profile: Poor to Excellent personal credit accepted
  • Time in Business: 2 years in business
  • Documentation: Application, 3 months business bank statements. No income verification doc required, making this a suitable low-doc option for businesses with specific financing needs like real estate investors managing equity and rent inflows.
  • Processing Time: Fast Funding: Same Day to 48 hour
  • Income Verification: No profit & loss required. Uniquely, this stated income business line of credit is primarily based on the borrower's stated income, easing the financing terms for certain businesses, particularly those that generate income from rental properties or have significant equity in their holdings.

Does Personal Credit Matter?

The fact that you are not proving profit/loss with a tax return and just stating your income means that lenders will rely more on your personal credit. Better you credit the greater the likely hood of approval and better terms.

Why Stated Income Business Lines of Credit Are Popular With Small Businesses?

The stated income business line of credit is most popular among startups and small businesses due to following reasons:

  • Instant access to money on demand
  • Provides Emergency Cash Flow
  • Reduced paperwork demands
  • Introduces substantial convenience

With this hassle-free option, there's no need for such extensive paperwork financing, like some demanding business loans, making the documentation process far less cumbersome. Most lenders allow the applicant to complete forms online, for a hassle-free and convenient experience. This appealing feature of minimal paperwork requirements, contributing to a hassle-less process, makes it a go-to choice for various small businesses and startups.

Most Common Uses of Stated Income Business Lines of Credit

  • Working Capital for inventory or retail business operations
  • Cash Flow management in scenarios like seasonal gaps
  • Purchase Equipment, whether heavy machinery or a new company vehicle
  • Capital for Expansion, including warehouse storage or IT infrastructure
  • Employee Recruitment/Employment Resources for running payroll effectively
  • Advertising/Customer Acquisition, enabling you to reach new markets
  • Last Minute Emergencies, such as immediate inventory purchases or equipment repair.

The Pros and Cons of Stated Income Business Credit Lines for Small Businesses


  • No Income Documentation (stated income, no adjusted gross income formulas, no tax returns)
  • Most Industries acceptable
  • Lower personal and business credit score standards
  • Lower revenue requirements
  • No assets required
  • No personal collateral required from Business Owner
  • Flexibility for owners desiring a credit line for business to access funds on demand


  • Costs -The costs are more than traditional business financing to cover the additional risk that is involved with the lack of income verification.
  • Rates – The rates will be impacted by the lack of income proof
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4 Alternative Business Financing Options for Small Business Owners

1. Short Term Small Business Loans

Short term business loans are a great alternative when you need money fast and business line of credit is not an option. Terms range from 6 to 24 months and usually no tax return required up to $250,000.

Product Overview

2. Business Cash Advance

Business Cash Advances, also known as a Future Sales Agreement, advances future sales to a business in return for a higher payback. This cost is called a factor rate and not a interest rate because it is a flat cost of money and not simple interest.

Repayment is made with a set percentage of future sales by a fixed ACH either weekly or daily Monday through Friday. Reconciliation can occur once a month to balance amount collected verse total sales against the set monthly percentage. If payments are over set percentage than a refund of difference will be issued upon request.

Payback is flexible based on fluctuating future revenue. This is not a business loan, but an advance off of future sales.

Product Overview

  • Rate: 1.13% up to 1.48%
  • Terms: Length of time of repayment depends on set percentage of future sales and future sales
  • Payment: Bi-Weekly, Weekly or daily Monday-Friday Fixed ACH
  • Credit Standards: All credit considered.
  • Financial Documents: 1-page application, Business Bank Statements

3.Merchant Cash Advance

A Merchant Cash Advance, also known as a Future Receivables Agreement, is similar to a BCA’s, but the only difference is the repayment method.

Merchant cash advance takes a fixed percentage of future credit card processing at batch of credit cards. This means repayment is attached to the flow of future sales and not a fixed payment.

Working capital is the most popular use of money for this product.

Product Overview

  • Rate: 1.13% up to 1.48%
  • Terms: Flexible, based on future sales
  • Payment: Set percentage of credit card processing batch
  • Credit Standards: All credit considered
  • Financial Documents: 1-page application, Business Bank Statements, Merchant Processing Statements. No tax return required in most cases.

4. Invoice Financing

Invoice financing companies offer an advance at time of issuance of an invoice for a small fee to the issuer. This accelerates cash flow for the issuer by not having to wait for the invoice to be paid by the client.

Product Overview

  • Rate: No interest rate. Flat fee product
  • Terms: Based on invoice terms
  • Fees: Fees start at 1% of invoice, up to 4% fee based on invoice financing agreement. Service fees also apply.
  • Credit Standards: No credit required from issuer. Credit of client is evaluated.

What is the difference between a stated income business loan and a low-doc business loan?

A stated income business loan and a low-doc business loan are similar in many aspects, but there are key differences. For a stated income loan, you merely state your income, without heavy emphasis on verification, but your financial information based on other factors will still be reviewed such as bank statements. However, for a low-doc business loan, you are required to provide less comprehensive financial documentation than conventional loans, but more than a stated income loan. In these cases, you may need to provide business bank statements or proof of collateral, for instance. Each serves different needs, so understanding your revenue model and financial management system aids in making an informed borrowing decision.

Benefits of Stated Income Business Credit lines

How a Stated Income Business Line of Credit is Different from Others

Unlike traditional business loans or other types of lines of credit, a stated income business line of credit primarily considers the stated income of the applicant during credit approval, rather than relying heavily on financial documentation. This makes it a preferred option for businesses with hard-to-document income or those whose income might vary substantially from one year to another. This feature makes a stated income business line of credit approachable, and can give entrepreneurs a substantial boost in their financial standing. It's an ideal option for businesses that don't follow the traditional revenue flow, such as rental property owners or self-employed individuals.

  • When it comes to differentiating the stated income business line of credit from other lending options, the primary distinguishing factor lies in the income verification process and the minimalistic documentation.
  • Traditional lending options require you to submit extensive documentation, such as detailed tax returns, bank statements, balance sheets, and income statements. However, a stated income business line of credit primarily considers the income that you declare. This requires significantly less paperwork, which results in a much less exhaustive application process.
  • While most credit lines are based on the financial stability of a business as inferred from extensive financial documents, the stated income business line relies more on the stated income. This offers a more lenient and flexible borrowing option for businesses with fluctuating income or whose income documentation may not paint the whole financial picture. These features grant it unique accessibility, especially for newer businesses, startups, and self-employed professionals.
  • A stated income business line of credit operates differently from other financing options. Instead of focusing on thorough financial documentation for approval, it primarily considers the borrower's stated income. This makes it a flexible financial solution for businesses with irregular income streams or those hesitant about revealing exhaustive financial details.
  • Unlike conventional credit lines, stated income credit lines do not necessarily require extensive financial documentation such as annual tax returns, balance sheets, and more. Instead, it allows businesses to qualify based on simpler criteria, mainly their stated income. This unique feature lends a level of accessibility and convenience for businesses that may not meet the rigorous documentation requirements of traditional business loans, particularly newer or non-traditional businesses such as freelancers and contractors.

However, it's worth noting that borrowers still need to meet certain qualifications, like credit score criteria, and the risk associated often triggers higher interest rates compared to standard business loans. Each business needs to evaluate this approach's pros and cons carefully according to its specific needs and financial abilities.

Benefits of Acquiring Stated Income Business Line of Credit

Stated income business line of credit provides a range of benefits which are often advantageous for business of all sizes:

  • Ease of Approval: With this type of credit line, the approval process revolves around the stated income, making it less stringent and faster.
  • Flexibility: Such a credit line offers flexibility for businesses as it is based on income and not fixed business assets.
  • Versatility: One can use a stated income business line of credit for various purposes, including inventory purchases, working capital, expansion, or even debt consolidation.
  • Minimal Documentation: Stated income lines of credit often require less documentation which simplifies the application process.
  • No Collateral: Most of the time, a stated income line of credit does not require specific collateral, making it more accessible to businesses with limited assets.

Through these benefits, a stated income business line of credit can become a crucial asset for businesses in managing their short-term cash flow requirements. The streamlined approval process, coupled with the lack of necessity for collateral, make this an attractive option for businesses in several industries.

Opting for a stated income business line of credit can significantly reshape the idea of business financing. Here are some key benefits:

  • Simplified Approval Process: Stated income lines of credit have a more straightforward approval process, which makes them a convenient option for borrowers.
  • Financing Flexibility: With a line of credit based on stated income, you’ll have the freedom to handle fluctuations in business income. This flexibility allows you to adapt to varying situations, making your business resilient.
  • Multipurpose Use: Be it an inventory purchase, debt consolidation, working capital, or expansion - a stated income business line of credit can be used for several business purposes.
  • Minimal Paperwork: Stated income lines of credit are a relief for those intimidated by the labyrinth of paperwork associated with traditional loans. You only require a few necessary financial documents for the application, saving you considerable time.
  • Access to Funds Despite Limited Assets: In most cases, these lines of credit don't need collateral, which means more businesses, especially startups, can leverage this type of credit line, even if they don't have substantial assets.

In conclusion, tapping into stated income business lines of credit can be instrumental in taking your business to new heights while making the journey less daunting with minimal paperwork and perkier financing flexibility.

Understanding Low-Doc Business Loans

How Low-Doc Business Loans Work?

Low-doc business loans can be a suitable solution for businesses seeking funding that doesn’t entail an extensive documentation process. However, these business loans work differently than traditional ones.

A low-doc business loan doesn't require heavy paper work. However, some documentation is necessary, though dramatically less than that of a standard business loan. Key financial information is still needed to approve your loan, but a minimal set of documents is typically required. This may include:

  • Current Business Bank Statements
  • Proof of active business operation
  • Proof of your identity

You just fill out a shorter application form, submit the selected documents and allow your lender to assess your application. Lenders aim to provide funds as swiftly as possible to fast track your low-doc business loan.

Once these main documents are submitted, the lender assesses your loan application based on this minimalistic financial data. They then provide fast and flexible financing solutions tailored according to your business needs. This form of fast financing, in the face of fewer financial documents, paves the path to smoother business operations and growth opportunities.

Most Common Uses of Low-Doc Business Loans

While a low-doc business loan can be used for a wide range of purposes, here are some of the most common uses:

  • Expansion: Businesses often use this loan type to fund growth projects like opening a new branch or purchasing additional equipment.
  • Inventory: Buying inventory, especially during high-demand seasons or product launch durations, is another popular way to use these loans.
  • Working capital: Low-doc business loans can be used to cover everyday business-related expenses, ensuring smooth business operations.
  • Debt consolidation: Businesses can consolidate their debts into one payment that can be easier to manage.
  • Emergency expenses: Unforeseen emergencies can create a cash crunch. These loans can come in handy to tackle unexpected costs, whether it's equipment repair or immediate inventory procurement.

To sum up, low-doc business loans are a versatile and fast financial solution, enabling businesses to effortlessly manage their expenses and seize opportunities for growth.

Frequently Asked Questions

Who Needs a Stated Income Business Line of Credit?

A Stated Income Business Line of Credit is primarily designed for business owners who have an irregular or difficult-to-document income but still require flexible funding. This includes:

  • Small businesses and startups that may not have consistent income or extensive financial histories, making it difficult for them to qualify for traditional loans.
  • Self-employed individuals or independent contractors who may have variable income that is hard to document through standard channels.
  • Real estate investors who have irregular income streams based on property sales, rental income, and turnover of properties.

For these types of businesses, a Stated Income Business Line of Credit offers an accessible, flexible way to secure necessary funding.

Can I use a stated income business line of credit to consolidate other debts?

Yes, you can use a stated income business line of credit to consolidate other debts. Consolidating debts into one can help manage repayments and potentially offer a lower interest rate. However, it's crucial to bear in mind that terms and conditions vary, so you should insure this option's suitability for the business's financial health. Always evaluate the overall costs, interest rates and repayment terms before taking a decision. It is also advisable to advise with a financial advisor or a credit counselor.

Facts about Applying For a Stated Income Business Line of Credit

Fact #1: Stated income means you don't have to prove profit or loss with a tax return. However, this doesn't rule out the necessity of business bank statements.

Fact #2: There is no such thing as a NO documentation loan or line of credit. In reality, even low-doc commercial loans require some documentation.

Fact #3: You must supply at least 3 to 4 most recent business bank statements to get business financing, including a k line of credit.

Don't be fooled by those who claim otherwise. Remember, whether it's a stated income business line of credit or any other types of business loans, always scrutinize your quotes and offers, considering factors like maintenance fees that some lenders may charge to keep the line of credit open.

Choose AdvancePoint Capital for your Stated Income Business line of credit needs.

  • Experience– Our expertise range across various industries.
  • Trust– Thanks to our excellent reviews and feedback.
  • Loan Specialists – Our team comprises experienced business funding specialists.
  • Free to Get a Quote -Without a commitment or upfront fees.
  • Products– Our marketplace houses diverse products involving business loans, lines of credit, SBA loans, equipment financing, and other alternative funding options.

Unleash your business's potential by acquiring a stated income business line of credit today!

The fast, convenient, and straightforward way entrepreneurs can raise capital and secure the funds needed to expand business – now. Achieve success by getting your Quote Today.

Jacques Famy Jr

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