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Types of Fast Business Loans

Max Freedman
Max Freedman
business.com Contributing Writer
Updated Jul 20, 2022

When your business needs a quick infusion of cash, what are your options? Learn about the different types of fast business loans and what you need to apply for them.

They say the only two things certain in life are death and taxes, but in business, there’s a third constant: the need for money. When you can’t immediately cover that need with your own cash or assets, fast business loans may help. These types of alternative funding sources can get you ample cash more quickly than more traditional lenders can. Read on to learn whether a fast business loan is right for you, what you need in order to get one, and what types of fast business loans are available.

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6 fast business loans

Top fast business loan lenders

Alternative lenderTime to depositLoan sizeCollateral
Rapid FinanceSame dayUp to $10 millionNo
SBG FundingSame dayUp to $5 millionNo
Balboa CapitalSame dayUp to $250,000No
Crest CapitalSame dayUp to $500,000No
FundboxNext business dayUp to $150,000No
AccionVariesUp to $150,000Yes

With a fast business loan, you can expect the money in your bank account within a day or two. Many lenders tout speedy loan deposits, but there are some that really stood out to use when reviewing the best business loans

Rapid Finance

This online lender provides business owners with funding the same day as approval. Rapid Finance will lend business borrowers anywhere from $5,000 to $10 million. The lender has a simple online and mobile application and fast approvals. It also has an online portal that enables you to track the status of your loan and manage it. Rapid Finance offers a variety of loan types including term loans, merchant cash advances, and lines of credit. Learn more in our complete Rapid Finance review.

SBG Funding

SBG Funding can also fund a loan the same day it’s approved. This lender offers a variety of financing options including term loans, lines of credit, equipment financing, bridge loans, and invoice factoring. With many of these loan types, you’ll get a decision on your application in 24 hours. We also like that you can make payments on your loans either monthly or weekly, and can borrow up to $10 million. You can learn more in our full SBG Funding review.

Balboa Capital

Another lender that can fund loans the same day as approval, Balboa is also willing to work with borrowers with challenged credit scores. Balboa looks at more than borrowers’ credit scores. We like this lender uses automated decision-making technology, which quickens the approval process enabling same-day funding. Our comprehensive review of Balboa Capital has more details.

Crest Capital

Small business owners who need fast equipment financing need look no further than Crest Capital. Through our research of Crest Capital, we found it is among the fastest lenders in the marketplace. Not to mention it has flexible terms, allowing you to finance equipment for as short as 24 months to as long as 84 months. With this lender, you can borrow anywhere from $5,000 to $500,000. As a bonus, no collateral is required, since the loan is backed by the equipment you are financing. Learn more in our Crest Capital review

Fundbox 

When it comes to a line of credit, Fundbox stands out in terms of the speed at which you can access your money. Fundbox utilizes digital technology that lets you connect your accounting software and/or bank account with the application. That enables Fundbox to underwrite and approve the loan quickly and in some cases fund it the same day. This online lender offers credit lines of up to $150,000 with terms ranging from 12 to 24 weeks. Our full review of Fundbox has more information.

Accion

For small business owners who need a microloan fast, we found Accion delivers. Through the Accion Opportunity Fund, this nonprofit lender provides fairly priced loans, educational resources, coaching and networking to small businesses. Accion keeps it simple with an online application that takes 15 minutes to complete. This nonprofit works with lenders in local communities, so the time to get your cash can vary. Our research of Accion found that some microloans can be funded on the same day of approval or the next business day. Learn more in our Accion review.

Who should consider a fast business loan?

If your company is experiencing any of the following situations, you may want to consider a fast business loan:

  • Emergencies. Even if you have excellent business insurance, unexpected emergencies can create urgent needs for your company that require rapid but expensive fixes. That’s where fast business loans come in. With these loans, you can fix the damage now and pay off the money used for this work later.
  • New company expenses. Starting a business is expensive, and so is growing one. Both of these crucial business tasks may require more money than you can feasibly generate from sales. With a fast business loan, you can get startup or growth funding much more quickly than you could through your standard revenue-generating routes.
  • Time-sensitive business opportunities. Let’s say you’re faced with an obvious business opportunity that requires fast action – a third-party agency that can take you on immediately, a limited-time bulk sale on key items in your inventory, a purchase of a smaller company that will go with another buyer if you don’t purchase it now. Fast business loans make the money you need for these transactions immediately available.
  • Marketing campaign rescue. If your company has embarked on a midlevel sales or marketing campaign that isn’t getting the results you want, you can change that with more funding. Fast cash that arrives in the middle of a campaign can allow you to upgrade to a higher-level campaign that may maximize your return on investment.
  • General quick-cash needs. Whether your company is brand-new or established, you’ll likely have times where you need more cash than you have on hand – such as for payroll when you’re waiting on payment for several invoices. If you need cash quickly, fast business loans can get it to you.

TipTip: There are many reasons a business owner may need to take out a small business loan. The key is to make sure the costs don’t outweigh the benefits.

What documents are needed to apply for a fast business loan?

When applying for fast business loans, you’ll notice that no two providers have exactly the same requirements. However, it’s generally safe to prepare the following documents before applying for a fast business loan:

  • Basic business information. Most fast business loan providers will require you to provide your business name, address, contact information, and taxpayer identification number (TIN) or employer identification number (EIN). You may also need to provide all of the business owners’ Social Security numbers.
  • Credit history. Sometimes, all you need to provide is proof of your credit score. Other times, you’ll need to provide a more detailed credit history. Your credit history should show that you have no record of bankruptcies, as even one bankruptcy is often enough to disqualify you from access to fast business loans.
  • Business launch paperwork. You’ll need these documents to prove how long your company has existed. Many types of fast business loans are available solely to companies that have existed for a certain number of years.
  • Business licenses. Occasionally, loan providers will ask for proof that your business is properly licensed. In this case, you can include just your original business license – leave out other licenses, such as fire permits and DBAs.
  • Company tax returns. Most fast business loan providers have a minimum annual company income that applicants must meet to qualify for funding. Use your company tax returns to prove that your income is above this minimum.
  • Bank statements. Often, you’ll need to couple your company’s tax returns with bank statements for thorough income verification. It’s best practice to provide your most recent three months of bank statements when asked for any banking information.
  • Online software information. Some fast business loan providers require you to detail any online systems that your company uses for e-commerce, sales transactions, payroll and more.
  • Loan history. Be prepared to show your entire history of loan applications and approvals. Some lenders may require this information to determine whether you’re a smart choice of borrower.

Other basic business documents. You may also encounter lenders that require you to provide other basic business paperwork, such as your office lease, your basic company history and your mission statement.

You may also need to sign a personal guarantee or business lien that your lender provides. When you sign a personal guarantee, you become personally liable for any funds that your company cannot repay. Similarly, when you sign a business lien, you attach a company or personal asset to your loan, and if you can’t repay your loan, this asset could be seized.

FYIFYI: Before you apply for a loan with a fast funding lender, get all your documentation together. Missing paperwork can slow down the loan approval process.

Types of business loans 

If you’ve determined that a fast business loan is right for you, gather the documents listed above, and then decide which of these fast business loan options may be the best fit for your company:

1. Business credit cards

Just as you can easily apply for and receive personal credit cards, business credit cards are a convenient funding source for your company. Business credit cards often have low or no fees, and you can avoid interest fees if you repay your balance on time. Approval can take just moments or as long as two weeks. When you apply, you may need to provide more information than the requirements listed above, including your company size, industry and tax classification. Most of the companies and banks that offer personal credit cards also offer business credit cards.

2. Invoice financing

Through invoice financing, or factoring, you can turn an unpaid invoice into a loan. This type of financing is available from factoring companies. If a client you’ve invoiced hasn’t paid you and you need their cash now, an invoice financing company can loan you that amount of money. Sometimes, you’ll get the money you need just hours after providing basic financial information to the factoring company. However, collecting your client’s actual payment – which you’ll need to repay your invoice financing loan, fees, and interest – could take much longer.

3. Short-term loans

This broad category of fast business loans comprises any loans you can receive within hours or days. Short-term loans require full repayment, with fees and interest, within one to two years. Short-term lender requirements often overlap with those listed above, though they may vary by company. These loans are available online through alternative lenders.

4. Merchant cash advances

A merchant cash advance comes from your credit card processing company. You’ll get a cash infusion from your payment processor, and in return, the processor takes a cut of all your business’s future income on that card. Alternatively, your card processor will regularly withdraw fixed amounts from your account. You can usually get cash within a day, but your loan fees may be exceptionally high.

5. Equipment financing

If you’ve ever paid for an expensive item in monthly installments instead of all at once, then you’re familiar with equipment financing. With this type of fast business loan, you can get equipment immediately and pay for it over time. You can often be approved within two days, and you’ll have few paperwork requirements, since equipment financing is a low risk for the provider – the equipment itself is the collateral. If you fall behind on your payments, your provider takes back the equipment, leaving you back at square one with less cash than you previously had. This type of financing is usually available from businesses selling equipment, though many banks offer them as well.

6. U.S. Small Business Administration loans

SBA loans are often thought of as separate from fast business loans. After all, SBA loans are known for their lengthy approval periods. However, for SBA loans under $150,000, you may be able to receive funding in one week instead of several. Your requirements will be the same as they would with other lenders, but your interest rate will be lower and your repayment term longer. Though SBA loans are not as fast as the above options, the better interest rates and terms may be worth the wait.

Bottom LineBottom line: Business loans come in a variety of types with different terms, rates and fees. Your business needs, ability to pay and credit score will dictate which loan is right for your business.

What else to know before pursuing fast business loans

Even if you now feel ready to start applying for rapid business funding, you may encounter unfamiliar terms and concepts throughout your application process. Whenever you have questions, you can use the business.com business loan term glossary to help. Be sure to watch out for hidden gotchas as well – you shouldn’t ignore sneaky long-term costs even if you need an immediate solution.

 

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Kerkez / Getty Images

Max Freedman
Max Freedman
business.com Contributing Writer
Max Freedman is a content writer who has written hundreds of articles about small business strategy and operations, with a focus on finance and HR topics. He's also published articles on payroll, small business funding, and content marketing. In addition to covering these business fundamentals, Max also writes about improving company culture, optimizing business social media pages, and choosing appropriate organizational structures for small businesses.