Best Long-Term Small Business Loans

Small business owners need financing for various reasons, whether to boost their business’s creditworthiness, cover day-to-day expenses or purchase real estate. Knowing which long-term business loan options are available to suit your needs is essential for running a successful operation. Read on to learn more about our picks for the best long-term small business loans.

Our Top Picks for Best Long-Term Small Business Loans

• Live Oak Bank: Best Long-Term Small Business Loans for Women
• BusinessLoans.com: Best Long-Term Small Business Loans for Bad Credit
• SMB Compass: Best Long-Term Unsecured Business Loans
• Finance Factory: Best Long-Term Business Loans for Startups
• Lendio: Best Long-Term Business Loan Comparison Site

Best Long-Term Small Business Loans Reviews

Here are our choices for the best long-term small business loans.

Why we chose it: On average, female business owners are approved for less funding than men. Small Business Administration (SBA) loan programs, however, do not discriminate and can help women receive the financing they need to be successful. Live Oak Bank is the largest SBA lender in the U.S.

Live Oak Bank helps entrepreneurs meet their goals by providing long-term small business financing. However, it currently only supports 30 industries. This cloud-based bank is available in every state across the U.S. and Puerto Rico. On top of offering business financing opportunities, Live Oak also provides full-service business banking with business checking, savings and certificate of deposit (CD) opportunities available.

As an SBA-preferred lender, getting an SBA loan through Live Oak Bank may mean getting funding faster than applying through other institutions. Live Oak Bank was the top SBA 7(a) lender by dollar amount in 2022, but is also known for providing SBA 504 loans. The SBA 7(a) loans offer business financing of up to $5 million dollars, and the SBA 504 loans reach up to $5.5 million. Both SBA loan programs allow repayment terms that can last up to 25 years, depending on the purpose of the loan.

Live Oak Bank also offers business term loans and business lines of credit for business owners that need help getting an SBA loan or need extra financing. Live Oak doesn’t provide many details online about these financing methods. To learn about the interest rates and fees that will apply to your business, you will need to speak with Live Oak Bank’s lending team and discuss the details. Live Oak Bank also doesn't allow you to make payments online.

Live Oak Bank received an A rating from the Better Business Bureau (BBB) for addressing customer complaints, but is not accredited by the BBB.

Why we chose it: BusinessLoans.com can connect business owners with credit scores as low as 500 with lenders to provide business financing.

BusinessLoans.com is a marketplace lender that connects business owners with potential lenders. It offers multiple types of loans, including short-term loans, long-term loans, lines of credit and merchant cash advances. The length of the business loans varies by lender, but some loans can have a length of over 20 years.

While the BusinessLoans.com website doesn’t provide much information regarding loan pricing, it gives a general outline of what businesses need to receive financing. Requirements vary, but lenders usually ask for one to two years in business, a minimum annual revenue of $75,000 to $250,000 and a minimum personal credit score of 500 to 650. Industry requirements will also depend on the lender you are matched with. Some lenders may require collateral to back your loans.

The application process is free and takes minutes to complete. You’ll need to answer a number of questions, including how much financing you need, what you plan to use the funding for, how long you’ve been in business, your annual revenue, credit score and other questions. Once you’ve finished the application process, a representative will contact you and help you determine the best financing options for your business. While the application process is quick, once your financing is approved, it may take up to a week to receive your funds.

BusinessLoans.com is accredited by the Better Business Bureau, where it holds an A rating.

Why we chose it: SMB Compass offers great unsecured term loans that can amount to $5 million with terms of 25 years if you qualify. With nine different types of business financing available, it offers something for all businesses.

A quick search can reveal some of the best unsecured business loans available, but very few come with the term lengths and amounts you can get from SMB Compass. SMB Compass is a relatively new alternative lender with six years in business. It is very transparent about the eligibility requirements to receive funding and pricing of its financial products, making it easy to budget and plan using a long-term business loan calculator.

A wide variety of financing is available through SMB Compass, including:

• Business lines of credit
• SBA loans
• Equipment financing
• Asset-based loans
• Bridge loans
• Inventory financing
• Purchase order financing
• Business term loans

The term loans offered by SMB Compass can be anywhere from $25,000 to $5 million, with term lengths ranging from two to 25 years. To qualify for a business term loan, you need to have a business credit score of at least 680, six months of business history and an annual revenue of $500,000 or more. It may take anywhere from five to seven days to receive your funds.

A business line of credit through SMB Compass may be easier to get for some. The eligibility requirements are a business credit score of at least 600 and a minimum of $100,000 in revenue, but your business must be at least two years old. A business line of credit can assist you in the amount of $10,000 to $5 million with revolving terms. SMB Compass can dispense funds quickly in one or two days.

SMB Compass is not available in every state. It is a BBB-accredited company with a rating of A+, but has not received any customer reviews on the BBB website.

Why we chose it: Finance Factory positions itself as a company that makes financing easy for entrepreneurs and startups that may find it challenging to qualify for loans elsewhere.

Finance Factory has been in business since 2006 and works to provide financing for startups and alternative businesses. It's a marketplace that works with a number of lenders to provide funding to small businesses. It ranked as one of LendingTree’s top startup funding experts and finished in LendingTree’s Top 3 for customer satisfaction in business loans multiple times.

Finance Factory helps small businesses secure multiple types of funding, including:

• Startup funding
• SBA loans
• Business express loans
• Merchant cash advances
• Equipment finance
• Franchise funding

While Finance Factory can help you get an SBA loan, it is not an SBA-preferred lender. SBA-preferred lenders can approve loans without input from the SBA, making the application process much faster.

The startup funding that Finance Factory provides comes in several forms, including lines of credit, personal loans and business credit cards. The loan terms span anywhere from zero to seven years and range from $5,000 to $350,000. To qualify for financing, Finance Factory suggests having a credit score between 600 and 800, with over 700 being ideal. It also suggests having a monthly minimum account balance of $1,000 to $5,000 for cash flow. Collateral is also an option, although the company provides both secured and unsecured funding.

If approved, funds will usually arrive in seven to 10 days. Because the loans Finance Factory offers for startups are personal loans, an annual revenue threshold or minimum time in business is not required to get a loan. Finance Factory doesn’t have a pre-payment penalty, which means you can pay off your loan at any time. However, it does charge an origination fee for processing the loan, which can reach as high as 10%.

Finance Factory has an A+ rating from the Better Business Bureau and is also a BBB-accredited business.

Why we chose it: Lendio is a platform that allows you to view multiple loan options after applying for free through its website. Because of its partnership with more than 75 lenders and excellent customer reviews, it is our choice for the best long-term business loan comparison site. Lendio states that it has helped with more than 300,000 loans totaling more than $12 billion in the U.S.

Lendio allows access to many of the best small business loans available. Some of the small business funding options your business can access include:

• Accounts receivable financing
• Business lines of credit
• Business term loans
• SBA loans
• Equipment financing
• Startup loans
• Commercial mortgages
• Business acquisition loans

The options available to you and the terms and pricing of each loan will depend on your business.

To find and compare lending offers, you must complete an online application that will take about 15 minutes. For this application, you'll need to answer a series of questions and provide information regarding your credit score, monthly revenue and requested amount, as well as previous bank statements and other documents.

Once your application is complete, Lendio will match you with offers, and a representative will get in touch with you to explain your options. These consultations take place online and there isn't any option to meet a representative in person. After the lender approves your loan, you may receive your funding in just 24 hours, depending on the lender.

Applying for a loan through Lendio is free and available in all 50 states. Lendio will perform a soft pull on your credit to get a sense of your credit history, but this will not affect your credit score.

Lendio is a BBB-accredited business and boasts a BBB rating of A+.

Other long-term small business loans we considered

Here are some other long-term small business loans that we considered.

National Funding

National Funding has funded over 75,000 businesses with $4.5 billion. It boasts a fast application process that can get you approved and funded in as little as a day. Borrowers must meet the minimum requirements of being in business for six months and $250,000 in annual sales in their business bank account.

There are three types of small business loans that National Funding offers:

• Working capital loans to supplement your cash flow for day-to-day expenses

• Short-term business loans for general expenses lasting 12 to 18 months

• Equipment financing loans to buy new or used equipment with financing up to 10 years

If you have bad credit, National Funding says it has options for you. While receiving business financing from traditional banks may be challenging, National Funding will work with you to find a financial solution that can help get your business off the ground.

National Funding may be a great option for your business, but because its term loans have a maximum length of only 18 months, it didn't make our top five.

Rapid Financing

There are many business financing options at Rapid Financing. It offers small business loans, merchant cash advances, lines of credit, bridge loans, SBA loans, invoice factoring, asset-based loans and commercial real estate loans.

You can take out a small business loan through Rapid Financing from anywhere between $5,001 to $1 million with a term that can last up to five years. You must make payments through automatic withdrawals out of your business bank account. You can schedule fixed daily, weekly or monthly payments to repay your loans. The application process is quick, and funds may arrive on the same day.

While Rapid Financing comes with several financing options, most are short-term in duration, which is why it isn't one of our top picks. It also doesn’t provide a lot of details online. In order to determine the pricing and details of the loan you’re interested in, you’ll need to speak with a representative.

Funding Circle

Funding Circle is a global small business loans platform and is listed on the London Stock Exchange. It has helped 135,000 small businesses get funding worldwide.

Funding Circle only offers business term loans, SBA 7(a) loans and business lines of credit. You can take out a term loan from $25,000 to $500,000, and repayment terms can last up to seven years. It doesn’t charge prepayment fees, but there is a one-time origination fee. The application is fast and can be submitted online for free.

Funding Circle is an excellent option for receiving small business financing but doesn’t have enough types of funding to crack our top five.

Long-Term Small Business Loans Guide

Running a small business is a challenge. Understanding your potential financing options can be the difference in growing or dissolving your business. In this guide, we'll look at what long-term business loans are, how they work and the different lenders that offer them.

What is a long-term business loan?

Business loans can come in multiple forms, such as a business line of credit, a term loan, an SBA loan or commercial real estate financing. These loans have much longer repayment periods than short-term loans, which can have terms as little as a few weeks or months.

Borrowers must use long-term business loans only for financing their business. Some common purposes that business owners use funding for include:

• Day-to-day operations
• Acquiring a business
• Purchasing real estate
• Purchasing inventory
• Purchasing equipment
• Refinancing debt
• Building a credit score

Business loans can be useful tools if used correctly, but it’s important to consider all options and ensure you can pay off your loan entirely. The inability to repay a small business loan as agreed upon will result in late payment fees, interest accumulation and possible bankruptcy.

How do long-term business loans work?

To get a long-term business loan, you'll need to determine the type of financing you want and which lender to use. When applying for a long-term business loan, you must fill out an application form and provide the necessary materials about your business. The eligibility requirements will vary by lender.

When receiving a long-term business loan, you'll get the lump sum amount upfront to use as you see fit to help your business. In most cases, you will need to pay back your small business loan in monthly payments, but daily or weekly payment structures may also be available.

Long-term business loans have various repayment terms ranging from three to 10 years. Certain business loans with specific purposes, such as commercial real estate financing, can have repayment terms of up to 25 years. Lenders determine the pricing of a business loan by considering the business’s income, credit score and time in business.

Where to get a long-term business loan

Long-term business loans are available from multiple lenders, including traditional banks, credit unions and online lenders. SBA-based loans are available through various lenders, as well.

Traditional banks

A traditional bank is a bank that has a physical location. Traditional banks provide business financing options that can help your company. The business loans offered by traditional banks may have better interest rates and longer terms than some of the other lenders, but the application process often takes longer, and there may be more documentation required or stricter requirements.

Credit unions

Credit unions are exclusive not-for-profit institutions that act similarly to banks. If you take out a business loan from a credit union, your loan will most likely get processed faster, and you'll often get a lower interest rate than a loan through a bank. Some drawbacks of taking out a business loan through a credit union instead of a bank include getting smaller loan amounts and that you need to be a member of the credit union.

Online lenders

Online lenders are non-traditional institutions that offer business financing options. These lenders boast quick application processes and fast funding. The eligibility requirements needed to take out a loan aren’t as strict as those of traditional banks and credit unions, so they can be an excellent option for business owners with low credit scores. On the other hand, because the process is done entirely online, borrowers may have concerns about submitting their financial information.

SBA-backed loans

SBA-backed loans are loans distributed through lenders with a government guarantee. If a borrower defaults on an SBA loan, the SBA agrees to pay the lender up to 85% of the loss. SBA-preferred lenders can approve and distribute SBA loans faster than other financial institutions.

The SBA 7(a) and 504 programs are the most common SBA loan programs. The SBA 7(a) provides general financing of up to $5 million with repayment terms up to 25 years. SBA 504 loans can pay out up to $5.5 million to businesses that bolster job creation and business growth.

SBA loans can be an enticing option for business owners as the loans are government-backed and usually have low interest rates and lengthy repayment periods. However, to get an SBA loan, you’ll need to complete a great deal of paperwork and pass strict requirements. The application is then followed by a long waiting period. Certain types of SBA loans may require collateral, as well.

How We Chose the Best Long-Term Small Business Loans

In order to determine the best long-term small business loans available, we considered the following:

• Financial products: What kind of financing this lender offers

• Eligibility requirements: The standards set in order to qualify for a loan

• Loan terms: The length of the loan repayment period

• Loan amounts: The amount of funding available

• Pricing: How the lender determines the interest rate for a loan

• Fees: Additional expenses that come with a loan

• Third-party ratings: How third-party websites reviewed the lender

• Customer ratings: How previous customers reviewed the lender

Summary of Money’s Best Long-Term Small Business Loans

• Live Oak Bank: Best Long-Term Small Business Loans for Women
• BusinessLoans.com: Best Long-Term Small Business Loans for Bad Credit
• SMB Compass: Best Long-Term Unsecured Business Loans
• Finance Factory: Best Long-Term Business Loans for Startups
• Lendio: Best Long-Term Business Loan Comparison Site