Best Business Term Loans: Choosing the Right Fit for Your Company’s Growth

Running a business involves a series of decisions—some exciting, others crucial. One of the most pivotal is choosing the right financing solution when your company needs capital to grow, cover operational costs, or invest in new opportunities. Among the many funding options available, business term loans are one of the most reliable and widely used. But with so many lenders offering different terms, how do you find the best business term loan?

In this article, we’ll break down what business term loans are, how they work, what to look for in a great loan, and highlight some of the top providers for different business needs.

What Is a Business Term Loan?

A business term loan is a lump sum of capital borrowed from a lender and repaid over a fixed period—known as the term—with interest. The term can range from a few months to several years. This type of financing is ideal for businesses seeking predictable payments, clear repayment timelines, and flexibility in usage.

Common uses of business term loans include:

• Purchasing equipment or inventory

• Expanding operations or opening a new location

• Hiring staff or funding payroll

• Covering cash flow gaps

• Refinancing existing debt

Business term loans can be either secured (requiring collateral) or unsecured, depending on the lender and your business’s financial profile.

Key Features of a Great Business Term Loan

Before we dive into the top lenders, let’s look at the qualities that define the best business term loans:

1. Competitive Interest Rates
   Look for lenders that offer low annual percentage rates (APRs), especially if your business has strong credit and cash flow.

2. Flexible Loan Terms
   The best loans provide flexibility with repayment periods, whether short-term (3–18 months) or long-term (1–10 years).

3. Fast Funding Times
   When time is of the essence, choose a lender known for quick approvals and disbursements.

4. No Hidden Fees
   Transparency is essential. Watch out for origination fees, prepayment penalties, or maintenance fees.

5. Easy Application Process
   Online applications and digital document uploads streamline the process, especially for small business owners.

6. Reputation and Support
   Choose lenders with good reviews, excellent customer support, and a strong track record of working with businesses like yours.

Top Providers of Business Term Loans in 2025

Here are some of the best business term loan providers, each with unique strengths depending on your business needs.1. Lendio – Best for Loan Comparison

Why it stands out:
Lendio is not a direct lender but a loan marketplace that matches your business with dozens of lenders based on your profile. It’s ideal for comparing offers and choosing the best rate and terms.

• Loan amounts: $5,000 – $2,000,000

• Terms: 1 – 10 years

• Interest rates: Starts at 6%

• Time to funding: As little as 24 hours

• Best for: Businesses that want to compare multiple offers

2. Fundbox – Best for Short-Term Loans

Why it stands out:
Fundbox offers fast, short-term loans with minimal documentation. It’s perfect for small businesses that need quick access to working capital.

• Loan amounts: Up to $150,000

• Terms: 12 or 24 weeks

• Interest rates: Weekly fees start at 4.66%

• Time to funding: Within 1–2 business days

• Best for: Businesses with strong cash flow and no time to waste

3. Bluevine – Best for Flexibility and Speed

Why it stands out:
Bluevine is known for its fast approval and funding, plus no prepayment penalties. Great for tech-savvy entrepreneurs who prefer handling finances online.

• Loan amounts: Up to $250,000

• Terms: 6 to 12 months

• Interest rates: Starts at 6.2%

• Time to funding: As little as 24 hours

• Best for: Fast-moving businesses looking for short-term financing

4. Credibly – Best for Bad Credit

Why it stands out:
If your business has less-than-perfect credit, Credibly offers options for working capital loans and business expansion. They consider more than just your credit score.

• Loan amounts: $5,000 – $400,000

• Terms: 6 – 24 months

• Interest rates: Factor rates starting at 1.15

• Time to funding: 24–48 hours

• Best for: Businesses with credit scores as low as 500

5. OnDeck – Best for Repeat Borrowers

Why it stands out:
OnDeck rewards repeat customers with lower rates and higher loan limits. Their easy online application and fast funding make them a favorite for returning users.

• Loan amounts: $5,000 – $250,000

• Terms: 3 – 24 months

• Interest rates: Starting at 29.9% APR

• Time to funding: Same-day possible

• Best for: Loyal borrowers with ongoing funding needs

6. Funding Circle – Best for Established Businesses

Why it stands out:
Funding Circle is a peer-to-peer lending platform offering long-term loans for mature businesses with solid credit and revenues.

• Loan amounts: $25,000 – $500,000

• Terms: 6 months – 7 years

• Interest rates: Starts at 7.49% APR

• Time to funding: 3–5 days

• Best for: Well-established businesses looking to grow

How to Apply for the Best Business Term Loan

While lenders differ in processes, these general steps apply:

1. Check Your Credit Score
   A higher score means better rates and more options. If your score needs improvement, consider waiting or applying with alternative lenders.

2. Gather Financial Documents
   Have your tax returns, bank statements, profit-and-loss statements, and balance sheets ready.

3. Compare Loan Offers
   Use a platform like Lendio or apply to several lenders directly. Review APR, repayment terms, and fees.

4. Apply Online or In Person
   Most lenders allow online applications. Be honest and accurate in your application.

5. Review the Agreement Carefully
   Check for fees, prepayment penalties, or automatic renewals. If anything’s unclear, ask questions before signing.

6. Receive Funds
   Once approved, funds may be deposited in your account within one to five business days, depending on the lender.

Final Thoughts

Finding the best business term loan is about more than just chasing the lowest rate. It’s about aligning your financial goals with a lender that understands your business’s needs, timeline, and repayment capacity.

Whether you’re planning to scale operations, replace outdated equipment, or simply boost working capital, the right term loan can provide the stability and capital to move forward confidently. Always compare offers, understand the terms, and choose a lender that supports your long-term vision—not just your short-term need.

What Is a Business Term Loan?

A business term loan is a lump sum of capital borrowed from a lender that is repaid over a set period—typically ranging from one to ten years—with a fixed or variable interest rate. These loans are often used for large, one-time investments such as equipment purchases, office expansion, or working capital needs.

Why Choose a Term Loan for Your Business?

Business term loans offer several benefits:

• Predictable Monthly Payments – Helps in budgeting and financial planning.

• Lower Interest Rates – Typically lower than credit cards or merchant cash advances.

• Larger Loan Amounts – Suitable for major capital expenditures.

• Structured Repayment Plan – Fixed or flexible terms based on business needs.

Types of Business Term Loans

There are generally three types of term loans:

1. Short-Term Loans (6 months – 2 years): Ideal for urgent needs or cash flow gaps.

2. Medium-Term Loans (2 – 5 years): Good for moderate business investments.

3. Long-Term Loans (5 – 10+ years): Best for significant, long-term projects like real estate or equipment.

Best Business Term Loans in 2025

Here are the top lenders offering the best business term loans this year, based on interest rates, loan amounts, terms, and customer service:

1. Bank of America – Best for Established Businesses

• Loan Amounts: $10,000 to $100,000+

• Term Lengths: 1 to 5 years

• Interest Rates: Starting at 6.25% APR

• Pros: Competitive rates, branch support, relationship discounts

• Cons: Requires good credit and at least 2 years in business

2. OnDeck – Best for Fast Funding

• Loan Amounts: $5,000 to $250,000

• Term Lengths: 3 to 24 months

• Interest Rates: Starts at 11.89% APR

• Pros: Same-day funding, easy online application

• Cons: Higher interest rates for shorter terms

3. BlueVine – Best for Flexible Repayment

• Loan Amounts: Up to $250,000

• Term Lengths: 6 to 24 months

• Interest Rates: Starts at 6.2%

• Pros: Monthly repayments, no early repayment fees

• Cons: Only available to businesses with strong cash flow

4. Funding Circle – Best for Medium-Term Loans

• Loan Amounts: $25,000 to $500,000

• Term Lengths: 6 months to 7 years

• Interest Rates: Starts at 7.49% APR

• Pros: Great for growing businesses, transparent pricing

• Cons: Slower funding process (up to 10 days)

5. Credibly – Best for Low Credit Scores

• Loan Amounts: $5,000 to $400,000

• Term Lengths: 6 to 24 months

• Interest Rates: From 9.99%

• Pros: Works with borrowers with credit scores as low as 500

• Cons: Higher factor rates and origination fees

How to Choose the Right Business Term Loan

When selecting the best term loan for your business, consider the following:

1. Loan Purpose

Is it for a one-time purchase, expansion, or working capital? Match the loan term with the expected return from your investment.

2. Interest Rates and Fees

Compare APRs, not just interest rates. Watch out for origination fees, prepayment penalties, or late charges.

3. Repayment Terms

Choose a term length that fits your cash flow. Shorter terms mean faster payoff but higher monthly payments.

4. Eligibility Requirements

Lenders consider credit score, time in business, annual revenue, and existing debt. Ensure you meet the minimum criteria.

5. Funding Speed

If you need funds quickly, opt for online lenders like OnDeck or BlueVine.

Benefits of Business Term Loans

• Improved Credit Profile: Responsible repayment can strengthen your credit score.

• Tax Benefits: Interest payments may be tax-deductible.

• Ownership Retention: Unlike equity financing, you don’t give up business control.

Risks and Considerations

• Collateral Requirement: Some lenders may require personal or business assets.

• Debt Burden: High monthly payments can strain your cash flow.

• Strict Qualification: Traditional banks have stricter approval processes.

Alternatives to Term Loans

If term loans don’t suit your needs, consider:

• Business Lines of Credit – Flexible, revolving credit

• SBA Loans – Government-backed loans with favorable terms

• Equipment Financing – Ideal for purchasing machinery or tools

• Invoice Factoring – Advance funds based on unpaid invoices

Tips to Improve Your Chances of Approval

• Maintain a strong credit score (ideally 650+)

• Demonstrate consistent revenue and profit

• Prepare a solid business plan

• Reduce existing debt

• Organize your financial documents (tax returns, bank statements, etc.)

Conclusion

Business term loans remain one of the most powerful financing tools available to entrepreneurs in 2025. Whether you’re expanding operations, buying inventory, or stabilizing cash flow, choosing the best business term loan can make all the difference. By evaluating your needs and comparing top lenders, you can secure a loan that not only fuels growth but also fits your repayment capacity.

Frequently Asked Questions (FAQs)

1. What is the average interest rate on a business term loan?
The average APR ranges between 6% and 30%, depending on your creditworthiness and the lender.

2. How fast can I get approved for a term loan?
Online lenders can approve and fund loans within 24 to 72 hours. Banks may take 1–2 weeks.

3. Do business term loans require collateral?
Some do, especially larger loans. However, many online lenders offer unsecured term loans.

4. Can startups get business term loans?
Startups may struggle with traditional lenders. Consider microloans or SBA options designed for new businesses.

5. Can I pay off a term loan early?
Yes, though some lenders may charge a prepayment penalty. Check the terms before signing.