Get a Business Loan With Excellent Credit
If you’re one of those diligent and prepared business owners with excellent credit, the options for small business financing are abundant. Whether you’re looking for business loans, a business line of credit, SBA loans, or something beyond, your credit score can significantly impact your loan options, interest rate, and overall freedom for growing your business.
Here at AdvancePoint Capital, we make acquiring business loans for your business fast and convenient. You’ll get to enjoy all of the benefits of working with an alternative lender while gaining access to the best business loans available in the marketplace.
How Do I Qualify For a Business Loan?
While having excellent credit scores can undoubtedly make dealing with banks and traditional lenders less difficult, these lending outlets still make business owners jump through countless hoops, slowing down access to capital. Banks will want to see that you own a successful, established business before offering any capital, and your time in business will be a major factor.
AdvancePoint Capital speeds up the process of getting the money your business needs. Running a small business requires an incredible amount of initiative, bravery, ingenuity, and support. We’re here to offer that support by providing a wide range of financing opportunities from our network of online lenders to help with expansion, renovations, equipment purchases, working capital, and more. When you have the credit to grow, we’re here to give you the tools and resources you need to expand operations and catapult your business to the next level.
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AdvancePoint Capital makes the loan application process a simple, straightforward experience.
An Excellent Credit Score Impacts Business Loans
Credit bureaus run calculations to determine a business and personal credit score for small business owners. The FICO score is a universally understood measure of individual creditworthiness, ranging between 300-850. On the other hand, business credit scores typically fall between zero and 100.
- 780-850 Excellent Credit score Qualifies for the most products at best rates & terms
- 740-779 Very Good Credit score Qualifies for most products with good rates & terms
- 680-719 Average Credit Score Qualifies for many products with rates & terms impacted
- 620-679 Below Average Credit Score Offerings are limited with higher rates & limited terms
- <619 Subprime Credit Score Limited products available and high rates & limited terms
It should come as no surprise that the higher your score, the more attractive your business will look to a lender. Lenders will evaluate both your business and personal credit score to determine whether or not you’re a solid candidate for loans or financing.
Both traditional lenders and alternative lenders like AdvancePoint Capital will closely evaluate the personal credit score of a business owner. While it won’t play a significant role in certain financing products like merchant cash advances or short-term business loans, an excellent personal credit score can open doors for a wide range of attractive funding options with great rates.
5 Best Small Business Loans for Excellent Credit (September 2023)
Business Line of Credit
A line of credit is like a credit card allowing you to draw funds up to a credit limit when needed. You are only required to pay interest on the outstanding balance, so paying off early has benefits. Very popular for working capital issues that arise when operating a business.
- Credit limits up to $2,000,000
- Interest rates starting at 1% per month simple interest
- Flexible option to manage cash flow
Small Business Administration (SBA) Loans
Small Business Administration loans are government back loans with attractive rates and terms. Qualification is stringent but well worth it if you are qualified. The process requires documentation and time.
- Loan amounts up to $5,000,000
- Interest rates starting at 9%
- Terms from 2 to 25 years
Long-Term Small Business Loans (Traditional Loans)
Long-term business loans are a great option for large expansion projects for their business. Terms range from 2 to 10 years with monthly payments.
- Loan amounts up to $2,000,000
- Rates starting at 8%
- Commonly used for for a variety of business purposes
Business Credit Card
Business term loans offer attractive interest rates with fixed rates and terms
- Revolving line of credit
- Card is issued for purchases and paying bills
- Into rates starting at 0%, Rates can climb up to 27.99%
Invoice financing, also known as Invoice factoring, is an advance of an invoice generated with terms of net 15, 30, 45, or 60 days. This allows business owners to accelerate the payment of invoices for a nominal fee.
- No limit on amount of invoices can be purchased
- Receive up to 90% of Invoice at time of issuance
- Factor rates starting as low as 1% per invoice face value
Equipment financing is when the collateral of the equipment is used to secure the financing. Your credit, as well as your ability to repay, will dictate the rate and terms. Equipment financing can come in the form of a lease or a loan
- Up to 100% of equipment can be financed
- Factor rates on lease start at 12%, Interest rates on loans start at 8%
- Terms range from 2 to 5 years
What Lenders Consider Other Than Credit When Offering a Small-Business Loan? What Are The Requirements For Small Business Loans?
There is a wide range of factors to consider when looking to obtain the very best small business loan possible from a financial institution.
Time In Business
Time in business and how established your small business is will be a big factor for most lenders as they want to see a track record they can evaluate.
Your small business revenue should help guide your business financing decision-making. Some factors to consider are the amount of revenue, how frequent your deposits are, the average daily balance, and any cash reserves left in your business bank account. Use this information to make decisions about how much you need and as supplemental information for loan underwriters. Alongside other qualifying factors, they will use business revenue to determine risk.
There’s a significant difference between revenue and profitability, but both still play their role. Business revenue doesn’t always paint the most vivid picture of a company’s overall health. To qualify for small business financing for excellent credit, you’ll need to have solid profits. If you’re struggling in this department, other options provide flexible financing, such as small business lines of credit or short-term loans.
Certain industries have an easier time obtaining small business loans, while others may have a more difficult journey ahead. When looking for financing options that fit your particular small business, it’s essential to know that your industry can play a role in qualifying factors.
Knowing just how much you need is crucial during the research and discovery phase. Using some of the factors we mentioned, like business revenue, profitability, and industry type, can certainly help. Calculating the amount you need will help determine what kind of business financing with excellent credit can best suit your needs, whether a line of credit, term loans, SBA small business loans, and beyond.
What is Considered a Good Business Credit Score?
There is no traditional business credit score as you would find with personal credit FICO. Different business credit repositories have their own unique credit modeling score. Paying all vendors, creditors, and business finance products will be considered good business credit. It is not good for business credit if you have no business credit history, as it’s considered high risk. If you are wondering, do I need a good credit score to get a business loan? Although credit is a very important factor to lenders in securing approval for a business loan, there are business financing alternatives that will consider bad, or less-than-perfect credit to obtain business funding. Banks and credit unions only consider good to excellent credit, but alternative business funding offers short-term loans and merchant cash advances for those with credit impairment.
How to Get a Small Business Loan?
When applying for a business loan it is important to consider a variety of factors. You should follow the following steps when getting a business loan.
- Determining your need for business funding-You need to know what you plan on using the business funding for as that will dictate what products and terms you will be offered as well as determining what will be best when comparing offers.
- Understand your Credit- Its always a good Idea to get a copy of your credit and review before you apply to check to see if the report is accurate or their is credit repair needed to get your credit scores as high as possible. You can also push back on lenders who claim your credit is different than it really is.
- Search for your Business Loan Originator- Determine what business loan originator you would like to use. Start with your bank you do business banking and then research business loan brokers or online business lenders. Getting multiple offers from lenders is a good idea to find the best rates & terms.
- Consider products & Terms- Not only do you need to search loan originators but also what products are available out there that will best fit your business needs.
- Submit an Application- Once you have determined the loan originator(s) you are going to work with as well as the products you want to apply for you will want to apply and submit applications and provide the necessary documentation requested to receive business loan offers
Frequently Asked Questions
Advice, Tips, and Warnings for
Small Business Funding with Excellent Credit
Having excellent credit can make it seem like your small business options are limitless. You could easily get business lending with excellent credit from many lenders. While you certainly have more choices than those barely scraping by the minimum credit score requirements, you can still run into issues with small business lenders if you don’t play it smart. Make sure to ask questions like:
- What does my cost vs. analysis look like?
- Can I profit from this financing opportunity?
- What long-term benefits can I expect?
- Are the costs, terms, and fees worth it?
- Do I need a lump sum vs. revolving line of credit?
- Can I use this capital for more than one use?
- Is a personal loan a better option?
Asking yourself these difficult questions can help prepare you for growing and expanding operations. AdvancePoint Capital is here to make your financing journey simple for those with good credit.