Short-term business loans offer financing with a quick payment turnaround — typically three to 18 months. Commonly available through online lenders, short-term loans are ideal for cash flow gaps, emergency expenses, working capital and more. If you’re seeking fast financing and can repay it quickly, short-term loans may be the right choice. We’ve compiled a list of lenders to help you secure the best short-term loans for your background and qualifications.

• Best short-term business loans
• Best short-term lines of credit
• When to avoid short-term business loans
• Short-term business loans FAQs

Best short-term business loans

Whether you need a short-term loan to expand your business or buy a piece of equipment, choosing the right lender is key. To be included on our list of best short-term business loans, lenders needed to meet the following criteria:

For small to medium purchase: OnDeck

Offering loans from $5,000 to $250,000, OnDeck may be a good option for business owners with small or medium financing needs. Terms can range from 3 to 24 months with APRs starting at 35% (54.23% is the average rate). OnDeck charges an origination fee of up to 5% of the loan amount.

To qualify for a short-term loan from OnDeck, you must meet the following requirements:

Depending on your state, you may receive financing the same day after approval for loans up to $100,000. The loan would need to be repaid in either daily or weekly installments. Business owners that qualify for the Prepayment Benefit option do not incur any fees or penalties for paying off their loans early. OnDeck does not extend financing to borrowers within Nevada, North Dakota or South Dakota.

For credit scores as low as 500: Credibly

Credibly working capital loans are available in amounts of $5,000 to $400,000 with terms from 6 to 18 months. With a 500 minimum credit score requirement, Credibly can be suitable for low-credit applicants. Credibly charges a factor rate instead of an interest rate — the cost is calculated by multiplying the factor rate by your total loan amount. Factor rates start at 1.15 and can rise to 1.45 and higher. An origination fee of 2.5% of the total loan amount would also apply if you get approved.

Interested business owners should meet the following minimum criteria:

It typically takes one business day after approval to receive the funding. Repayment would follow either a daily or weekly repayment schedule.

For larger loans up to $500,000: Funding Circle

Offering the highest amount on our list, business owners can secure $5,000 to $500,000 with Funding Circle’s business term loan. Short-term loan interest rates from Funding Circle can range from 9.49% - 30.12% APR with repayment terms ranging from 3 months to 60 months.

Funding Circle collects an origination fee of 3.49% to 6.99% of the loan amount and may require collateral and a personal guarantee from the primary business owners. Eligibility requirements include:

Funding Circle does not post minimum revenue requirements but does state the average of borrowers they accept do $1.4 million in annual sales. It typically takes one to three business days after approval to receive funding. Business owners can choose to make weekly, biweekly or monthly installments and will not incur any prepayment penalties for repaying the loan early. Funding Circle business term loans are not available to Nevada-based businesses or certain industries, such as casinos or speculative real estate.

For established business: Credibility Capital

Credibility Capital offers loan amounts of $50,000 to $350,000. Terms can range from 1 - 4 years with interest rates spanning 6.99% - 21.99%. Business owners with 25% ownership in the business must sign a personal guarantee, a provision that means you are personally liable for repaying the loan. Also, Credibility Capital secures the loan with a blanket Uniform Commercial Code — you would not be able to use the same assets for other types of financing (until you repay the full loan amount). The origination fee can range from 4% to 6%. To qualify for a Credibility Capital loan, business owners should meet the following requirements:

Due to these extensive requirements, Credibility Capital is a better fit for more established businesses. Time to funding typically takes up to three days after approval and follows a monthly repayment schedule. Business owners do not incur any prepayment fees for repaying the loan early. Businesses in Nevada, North Dakota, South Dakota or Vermont are not eligible for financing.

Best short-term lines of credit

For lines of credit, you draw funds on-demand without needing to reapply each time and only pay interest on the amount you borrow — this set-up is ideal for having capital on standby for when you need it. To be included on our list of best short-term lines of credit, lenders needed to meet the following criteria:

For the shortest repayment terms: Fundbox

Fundbox offers lines of credit of $1,000 to $150,000 with terms of 12 or 24 weeks — the shortest of those on our list. Interest rates start at 4.66% for 12-week terms and 8.99% for 24-week terms. Fundbox does not charge an inactivity fee (if you don’t use the funds immediately), application fees, draw fees or monthly fees. There is also no penalty for early repayment.

The following minimum eligibility requirements would apply:

Fundbox states they accept applicant backgrounds with only 3 months in business and don’t enforce a hard minimum for annual revenue requirements. However, they also disclose an ideal applicant should have at least $100,000 in annual revenue and six months in business. The funds should be deposited into the business owner’s bank account within two business days after approval. Lines of credit are paid back in weekly installments.

For good credit scores: OnDeck

OnDeck line of credit amounts can range from $6,000 to $100,000 with repayment terms of 12 months. APR starts at 35.9% with 47.14% being the average. OnDeck does not charge any draw fees or prepayment penalties but does charge a $20 monthly maintenance fee (first six months waived if you make an initial $5,000 minimum withdrawal).

OnDeck eligibility requirements for a line of credit include:

OnDeck’s 600 minimum credit score requirement is a good fit for those with good or fair credit. Time to funding is quick — potentially the same day as approval. Future credit draws are just as speedy. For withdrawals between $1,000 and $10,000, business owners can access the funds within seconds. Business owners will repay credit draws in weekly payments.

For low revenue requirements: Headway Capital

Headway Capital offers lines of credit from $5,000 to $100,000 with the choice of a 12-month, 18-month or 24-month term. The monthly rate can range from 3.33% - 6.00% APR. To qualify for a Headway Capital line of credit, business owners should meet the following requirements:

Requiring only $50,000 in annual revenue and no credit score minimum, Headway Capital’s lower requirements can be attractive to businesses with lower revenue. While Headway Capital does not charge any monthly or annual fees, they may collect a 2% draw fee each time you draw from your line of credit (depending on your state). Time to funding typically takes one business day after approval. Weekly or monthly repayment schedules are available and business owners do not incur any prepayment penalties for early repayment.

For affordable rates: BlueVine

BlueVine lines of credit are available in amounts from $5,000 to $250,000. Repayment terms range may be 6 or 12 months with simple interest rates starting at 4.8%. Business owners should meet the following requirements before applying:

BlueVine does not charge any monthly or prepayment fees. However, draw fees of 1.7% per week or 7% per month may apply. Business owners typically receive funding one business day after approval. You can also choose between a weekly or monthly repayment schedule. BlueVine lines of credit are not available to businesses in Nevada, North Dakota, South Dakota or Vermont.

When to avoid short-term business loans

Since short-term business loans are often easy to apply for online and quick to fund, they are helpful for business owners that need immediate financing. However, watch for red flags, such as high interest rates or confusing terms:

Short-term business loans FAQs

What is a short-term business loan? A short-term business loan offers loan amounts between $5,000 and $500,000 that you repay quickly — typically within three to 18 months. Short-term loans can be used for working capital, equipment, renovations and more. An online lender is often the best place to get a short term loan if you’re seeking a simple application process and fast funding.

Who should get a short-term business loan? Short-term small business loans are commonly used for startup expenses or covering immediate expenses, such as temporary cash flow gaps. Since short-term loans typically carry more lenient requirements, they may be a suitable financing option for applicants with bad credit — just be wary of unfavorable rates and terms.

Are there short-term loans for startup businesses? Yes, some lenders offer short-term loans to new businesses operating for less than one year. Although startups may qualify more easily with these lenders, be sure to research the tradeoffs, including high interest rates and inflexible repayment terms.