Best $300,000 Business Loans
How To Get a $300K Business Loan
Important Notice: For SBA Paycheck Protection Loans consider Fundera
|Loan Amounts||$5,000 to $500,000|
|APR Range||Term Loans: 7% – 30%|
Startup Loans: 7.9% – 19.9%
|Repayment Terms||Term Loans: Up to 10 Years|
SBA Loans: Up to 25 Years
|Time to Funding||Varies|
|Click “Check Rates” to apply to Fundera|
Before you apply for a $300,000 business loan, you need to determine what the right type of loan is for your small business. There are several different options, but the two most likely are SBA loans and Term loans.
SBA loans are loans offered by lenders that have a guarantee from the Small Business Administration. (They are commonly referred to as SBA 7(a) loans.) The repayment periods of these loans differ depending on why you need the loan and the amount. Generally, these loans are more difficult to qualify for. Since these types of loans are slower to fund, they are best for businesses that do not need immediate financing.
Term Loans, on the other hand, are lump sum business loans. These usually have an unfixed interest rate that will add to the repayments. These loans last for 1-10 years and are ideal for large investments and expenses, such as property and equipment. Term Loans are best for businesses that have been operating for a significant period of time, with good financial history and, therefore, great credit.
If you’re getting a business loan for the first time, we have a great post here you should read.
What Are The Business Loan Payments on $300,000 Loans?
The loan payments on 300K business loans vary depending on the type of loan, the lender, and your circumstances. If you qualify for a $300,000 business loan, you’re likely to get rates at the lower end of the scale, especially if it’s going to be paid off over a long period of time (more than 7 years, typically).
Currently (late April 2020), SBA loan payment rates are usually between 6 – 13%, depending on your term. SBA loans are unique because the term is often calculated by what you plan to use the money for. Some examples are:
- 7 years for working capital and daily operations
- 10 years for equipment purchases
- Up to 25 years for property purchases
SBA loans come with some of the most flexible repayment terms available, so you don’t need to take this guide too literally. If you have extenuating circumstances, such as taking out the money to cover a disaster, the term can even be 30 years.
Term loans are for a much shorter duration, typically 3-7 years. These loans work similarly to the way a personal loan does, in that you’ll take out the loan, receive a lump sum, and pay it back at a set interest rate over your term. This rate varies depending on the amount you borrow, your lender, your credit score, and other factors, but typically start as low as 6% and can be as high as 99%.
It’s wise to get an idea of what kind of repayment rates before you continue with your application, so you know what you can afford. To see a $300,000 business loan calculator, just click here.
What Type of $300,000 Business Loan Should You Choose?
If you’ve been an established business for at least 2-5 years, and don’t need the money soon, it may be worth applying for an SBA loan. The problem with these loans is that they can take a long time to get (weeks and months), and they’re more difficult to obtain because you can get such a low interest rate.
Recommended SBA Loan Service: SmartBiz
If you are looking to take out an SBA loan, you should look at a service like SmartBiz.
SmartBiz is an online service that will connect you to a lender for SBA Loans up to $350K. SmartBiz means that you will never have to go to the bank during your business loan application process. This is a great way for the more established business owners to borrow money to expand, refinance debts, or purchase real estate.
As mentioned above, their loans usually fund within a couple of weeks but can take months, so aren’t suitable for businesses that need money ASAP.
Term loans are much easier to get, and you’ll get your money quickly – typically days or even hours after approval, but the interest rates are often high. If you have great credit history, however, you’re much more likely to get approved at a low rate.
|Loan Amount:||$30,000 – $350,000|
|APR Range:||9.7% – 11.04%|
|Time To Fund:||Typically take several weeks to fund, but can fund as quickly as within seven days.|
|Loan Term:||Maximum loan term is 10 years.|
|How To Qualify:||675+ Personal credit score|
$50,000+ Annual revenue
|Great Option For:||Borrowers with good credit|
Funding real estate purchases
|Credit Check?||Soft credit check and hard pull|
|Co-Applicants Accepted?||No cosigners|
|Direct Pay-Off To Creditors?||No|
|Click “Check Rates” to apply to SmartBiz|
Recommended Term Loan Lender: OnDeck
If you think an online Term Loan would be more suitable for your business, you could look at OnDeck, which offers business loans up to $400K. With OnDeck, you can get funding in just one day, so it’s a great option if you have sudden unexpected expenses or an opportunity you want to jump on.
You don’t even need to have a particularly good personal credit score, and you can qualify even if you are a relatively new business. (Typically 2 years in business.)
If you need money to fund the purchase of new equipment for your business, you should consider a specialist Equipment Loan. Rather than paying the entire cost of your new equipment upfront, this business loan means that you can pay for the equipment in manageable installments over an agreed term.
Most lenders will match their loan terms to the lifetime of the equipment, ranging from about 2 to 10 years, but you may find that some lenders will provide terms up to 25 years. To find out more about what equipment loans may be available to you, click here.
|Loan Amounts||$5,000 to $500,000|
|APR Range||As low as 9.99%|
|Repayment Terms||Term loans up to 3 years|
|Time to Funding||As fast as 1 day|
|Click “Check Rates” to apply to OnDeck|
Is There a Down Payment for Business Loans?
Not typically, no – however, there nearly always is for an SBA loan.
SBA loans require a down payment the majority of the time. The down payment required will depend on your credit history, the type of loan you need and how much money you need, but it is usually somewhere up to 20%. Clearly, this can be a substantial amount – for our $300,000 business loan, the downpayment could be $60,000.
Some SBA loans don’t require a down payment, but these will be specified toward certain types of businesses and will come with many restrictions, so it may not be possible to get one of these business loans. However, the two most common SBA loans, SBA 7(a) and CDC/SBA 504, do require a down payment of 10 to 20%.
What Are The Best $300K Business Loans?
So, what are the best $300K business loans out there for your small business? We talked briefly about a couple of the best above, but here we will go into a bit more detail about their pros and cons.
Best for: SBA loans and Term loans of $30,000 to $350,000, for established businesses that have plans to make purchases or improvements weeks or months in the future.
- Funding can come within a week (but may take a little longer)
- Flexible repayment terms of up to 10 years for Term Loans
- Borrowing an SBA Loan can help you to build your company or refinance debts
- A great option for business owners with good credit
- Their loans have some of the lowest interest rates available for term loans – as low as 9.7% for Term Loans
- They are associated with eight affiliate companies to provide borrowers with a comparison of SBA Loan offers through just one application
- If your business is young (5 years or less), you may be less likely to qualify because their time-in-business and credit requirements are higher than other providers – you need to have a credit score of more than 680 with no tax liens, on-record bankruptcies or foreclosures
- For a loan of $300K (or more than $150K) your business revenue must be more than $300K itself in order to qualify for the loan
- Getting a loan through SmartBiz comes with added fees – whichever lender you choose will take 4% for “referral and repackaging fees” and you will have to pay all closing costs
- You will have to fulfill both the lenders’ requirements and those of the SBA to get approval for an SBA loan
- Applying for a business loan through SmartBiz requires you to have several documents to complete the application so it can take you over 2 hours to complete
Best for: Term loans of $5,000 to $400,000 for businesses that need or want fast funding.
- The funds may come through within 24 hours, so is a great option if you require immediate finance
- The application process is fast
- You can apply online or over the phone
- Relatively easy to qualify
- You are rewarded if you have borrowed from them before
- Allows you to build up your business credit
- They can be a lot more expensive than other lenders as they have higher interest rates – APRs start at 9.99% but can reach up to 99% on their short-term loans
- They charge a maintenance fee of $20 per month for their lines of credit
- There is a risk of seizure of business assets if you default on the loan as they back all of their loans with a blanket lien on business assets
- You have to sign a personal guarantee that allows them to pursue your assets if you are too late with re-payments
- They require a fixed monthly payment from a related business account, and Term Loans may demand a fixed daily payment
Best for: Term loans of $2,000 to $350,000 for businesses with “bad” credit for very short terms, as well as SBA loans for those with good credit.
- You can get the funds in as little as 72 hours
- They can approve most businesses that are making money – even if they have “bad” credit
- You don’t have to use a credit card
- Terms are short; 3 months – 2 years for Term loans, longer for SBA
- They offer flexible payments so you can pay back in a way that suits you
- Complete an online form, speak to an account executive, and then you’ll get a funding solution
- Automatically debits the money from your business bank account daily
- Terms may be too short for some
- They’re a smaller company that isn’t as established as larger lenders
- They don’t seem to give approximate APR rates, so you’ll have to contact them to find out
As you can see, you have many options for $300K business loans, and when you’re ready to apply, go to our site to see a comparison of the best options for you.