Short term loan

Short Term Loan

Short-term business loans provide a lump sum of funding to small businesses in need of financing for use. Check our short term loan options at Lendio.

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$ .00
Loan Amount Icon

Loan Amount

$25k – 700k

Loan Term Icon

Loan Term

3 – 10 Years

Loan Time Icon

Time to Funds

3 – 7 Business Days

Loan Interest Icon

Interest Rate

8 – 36%

Sometimes speed is everything.

No matter how much planning you do, small business ownership is full of surprises. Thinking on your feet and coming up with quick solutions is often the difference between shutting your doors and shutting out the competition. When time is money, a short term loan can get you financing in as little as 24 hours.

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Short Term Loan
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It’s not just fast – it’s also flexible.

A short term loan is like the Swiss Army Knife of loans – it’s handy, flexible, and able to get you out of a bind. You can use it to cover unexpected costs, survive a slump, finance a short term project, or even capitalize on a new business opportunity. It’s definitely the loan you want in your back pocket.

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Scoring a short term loan isn’t as hard as you think.

If you have solid credit and you’ve been in business for two years or more, you have a good chance of qualifying for a short term loan. Your lender may also ask you to put down some collateral to secure the loan.

You can find out if you qualify in less time than it takes to pick up your morning latte: just fill out our no-cost, no-obligation application to compare short term loan options from 75+ lenders. Now there’s a fine way to start your day.

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Our team can help you find the best deal.

You may be in a hurry to get financing, but you don’t want to rush into the wrong short term loan. That’s where our experts come in. Our personal funding managers can help you compare rates, terms, and payments for a variety of loan options so you can pick the right one for your business. Which means you don’t just get a short term loan, you also get the best deal out there.

Use our short term loan calculator to figure out how much you can afford, then see your options.

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How Do Short-term Business Loans Work?

Short-term business loans provide a lump sum of funding to small businesses in need of financing for use for a variety of reasons. There are few restrictions on the use of this type of financing option. They’re great for helping any small business that needs a loan amount from $10,000 to $500,000. This can help any small business looking to cover business costs as a short-term working capital loan.

Typically, you will apply for a short-term business loan with the loan application, your credit score, proof of your business’s cash flow and finances, your business history, and your business plan. Once approved, you could have access to funds in as quick as 24 hours. Then you can start using the funding for whatever your business needs are. Because of the quick timeline of short-term business loans, they have a higher interest rate than other funding options might. You can expect to pay an interest rate of at least 36%. They’re usually repaid over one to three years and if they’re repaid on time, can help boost your credit score. 

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What Are Short Term Loans Usually Used For?

One of the things that makes short-term business loans so great is that they can be used for nearly any business expense you’ve got. One use for a short-term loan is to cover unexpected business expenses that arise. This may come up if part of the building your small business is in needs repair, or if you need help to cover costs during a slow season. You can also use a short-term business loan for a new business opportunity that you need capital to make progress with, like if you want to expand your business and open a new location or if there’s a great opportunity to get a new space entirely. 

The speed with which you could get your funding from a short-term loan can also help you move quickly on these business needs, making it a great financing option for businesses that qualify for them and need quick funding. Remember, when considering short-term business loans, they’re short term. If you’re looking for higher loan amounts and a longer repayment period, a regular business loan might be a better fit for you.

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How Long Is a Short-term Business Loan?

The term for these small business loans is right in the name: short term. Short-term business loans typically have repayment terms of 18 months. So while it’s not the shortest repayment period for financing you could find, it’s a fairly short repayment term, especially if the loan amount is somewhere near the $500,000 amount. You could potentially repay the loan early if you wanted, but you would need to check whether there was a prepayment penalty before doing so. Any extra fees like a prepayment penalty would be outlined in the terms of your loan.

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How To Get a Short-term Business Loan

If you’re a small business owner looking for a short-term loan, don’t worry, we’ll explain how to apply for one. Maybe you’re looking for a short-term loan to help with cash flow, or to use as a short-term working capital loan. Either way, a short-term financing option can be helpful. \

First you should get together all the documents and application requirements you need in order to apply. These include:

  • Your detailed business plan
  • Credit reports
  • Your business history
  • Business tax returns
  • Personal tax returns 
  • Financial projections
  • Proof of collateral you might be offering (if you’re not applying for an unsecured business loan)
  • Business license or registrations

All of these financial documents should accompany your loan application. This application can be for a specific lender like Funding Circle, or for one of the loans offered by the Small Business Administration, or an SBA loan. Or it might be an application for a company like Lendio that can then offer you one application for a network of multiple lenders. After applying you will see what loan options you have and be able to compare those options and decide what is best for your small business needs. 

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Can Startups Get Short-term Business Loans?

When it comes to short-term business loans, they’re one of the more difficult types of small business loans for startups to qualify for. Because short-term lenders usually require at least two years of business history, these loans aren’t typically great for startups. Instead, new businesses might consider a business line of credit or a business credit card to get started. Then once you’ve got some more time in business under your belt, an established good credit score, and proof of monthly or annual revenue, you can apply for a short-term loan if you still need one.

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Can I Get a Short-term Business Loan with Bad Credit?

If you’ve got credit, you might be wondering if a short term business loan is the right small business loan for you. While there are some lenders that will lend to people with bad credit, the terms for those loans are not great. Generally, lenders look for a credit score of at least 650 for short-term loans. 

The thing about bad credit is that it takes time to improve. But it can be done, your credit score can change over time. Making on time, full payments towards your business credit card is a great way to boost that credit. 

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What Kind of Interest Rate Can I Expect?

There are a lot of variables that go into determining the rate you’ll likely get for your short-term business loan. As mentioned above, your credit score can impact the interest rate you pay. Additionally, whether the loan is secured with some form of collateral, or unsecured, can also impact the rate, because unsecured loans are a bigger risk for lenders. That being said, rates usually start around 8% and increase from there. You can use our small business loan calculator to get a good idea of what you might end up paying.

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FAQs

Can I get a short-term business loan even if I have bad credit?

You can get a short-term business loan even if you have bad credit but the terms will likely be less than ideal. If you’ve got a credit score under 650, you would probably be better off pursuing other forms of short-term financing like a business line or merchant cash advance, or waiting until you improve your credit score to apply for funding. 

Can I get a short-term business loan as a brand new “startup” business?

Short-term business loans are not ideal for startup businesses. For most short-term loans, lenders will be looking for a year or two in business history at least. So if you don’t have the business history, other forms of business funding might be a better fit for you.

How quickly can I get a loan for my business?

Some loans can provide you with cash in hand in as little as 24 hours after your application is approved. Having all of your application materials ready to go when applying can help speed the process along if you’re in a bind and need a quick cash flow boost.

Quotes

I worked with Doug on some short term financing for our slow season and upcoming dealer shows. I learned a lot from him about our business credit. He was great at communicating everything to me and the process was easy.

Brad

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