The Best Long-Term Business Loans of 2021

The best long-term business loans will provide flexible repayment terms and competitive interest rates. These loans can give you the cash on hand you need to grow your business and invest in success. Long-term business loans can be used for a wide variety of business-related expenses, and usually offer longer repayment terms and lower monthly payments than short-term business loans. However, they may also be more difficult to qualify for. Even if you have bad credit, there are still a variety of loan options available. When applying for a loan, you should consider multiple lenders in order to find the best deal possible.

Lending Partner
APR Range
Loan Amount
Term
  • Bluevine
    APR Range
    15%–88%
    Loan Amount
    Up to $250,000
    Term
    Varies
    Check Rates
    on lender’s secure website
  • OnDeck
    Logo for OnDeck
    APR Range
    16.9%–99.4%
    Loan Amount
    $5K–$250K
    Term
    Up to 18 months
    Check Rates
    on lender’s secure website
In this article

    The 6 best long-term business loans of 2021

    LenderAPRLoan AmountTermsEligibility
    LendingClub4.99%–24.90%$5,000–$500,0001–5 yearsIn business for 1 year, over $50,000 in annual sales
    Smart Biz 6.99%–24.99% $30,000–$500,0002–5 yearsIn business over 2 years, U.S. citizen or legal resident, personal credit of at least 650
    Street Shares 9%–40% $2,000–$100,0003–36 monthsIn business for at least 1 year, preference for veterans
    National FundingUndisclosed$5,000–$500,0003–5 yearsSmall business
    Funding Circle 4.99%–27.79%$5,000–$500,000Up to 10 yearsSmall business, in business for 2 years, personal credit of at least 660
    American Express 6.98%–19.97%$3,500–$75,0006–36 monthsMust be a cardholder

    Best online business lender – LendingClub

    Lending Club has solidified itself as a prominent peer-to-peer lender that funds personal and business loans alike. But its lack of product variety leaves something to be desired.

    APR Range
    4.99%–24.09%
    Loan Amount
    $5K–$500K
    Term
    1–5 years
    SimpleScore
    2.6 / 5.0
    close
    SimpleScore LendingClub 2.6
    Median APR 3
    Loan Size 4
    Product Variety 1
    Resources 2
    Fees 3

    Lending Club is a peer-to-peer lending marketplace with great rates and flexible term lengths. Lending Club is a peer-to-peer lender offering flexible long-term business loans with loan amounts ranging from $5,000 to $500,000 and terms lengths from six months to five years. The lender offers a quick and easy online application process and customer support every step of the way. In order to qualify, borrowers should be in business for 12 months or more and make at least $50,000 in annual sales. Lending Club doesn’t require a visit to your business or any business plans or projections. While there is no prepayment penalty, it does charge an origination fee of 3.49% – 7.99%.

    In The News
    In the News:

    If you have a LendingClub small business loan and your business has been impacted by COVID-19, there are hardship plans available. You can call LendingClub directly or visit its COVID-19 Help Center.

    Best SBA loans – SmartBiz

    Applying for an SBA loan has never been easier than with Smart Biz, which leverages technology for fast applications and approvals. Instead of weeks of paperwork filing, Smart Biz has your approval decision within one application.

    APR Range
    6.99%–24.99%
    Loan Amount
    $30K–$500K
    Term
    2–5 years
    SimpleScore
    3.4 / 5.0
    close
    SimpleScore SmartBiz 3.4
    Median APR 3
    Loan Amount 4
    Product Variety 3
    Resources 5
    Fees 2

    Smart Biz helps businesses secure SBA loans with great rates through a streamlined application process. While applying for SBA loans can be a daunting process, Smart Biz helps businesses secure long-term SBA loans through their network of banks and other lenders.

    While applying for SBA loans can be a daunting process, Smart Biz helps businesses secure long-term SBA loans through their network of banks and other lenders. There are a variety of fees associated with securing an SBA loan from Smart Biz, including an application fee of up to $3,000 and an SBA guarantee fee of 1.70%–3.75% depending on the loan amount. The funding process can take a week or more, so Smart Biz isn’t a good option for businesses that need funds fast. However, they make the process of applying for and securing an SBA loan relatively painless – and loans come with the gold standard combo of long term lengths and low rates.

    In The News
    In the News:

    If you don’t already have a business loan but you may need one to get you through the pandemic, then SmartBiz might be the place to go. SmartBiz offers SBA 7(a) Paycheck Protection Program Loans for small businesses that need something to help them through these hard times.

    Best for same-day funding – StreetShares

    Armed forces veterans reap the benefits of business loans through Street Shares, as the lender focuses on veteran-owned small businesses. With decent rates and high loan amounts, it secures its spot in best long-term business loans.

    APR Range
    9%–40%
    Loan Amount
    $2K–$100K
    Term
    3 months–3 years
    SimpleScore
    4 / 5.0
    close
    SimpleScore StreetShares 4
    APR 4
    Max Credit Line Amount 5
    Draw Period 4
    Resources 5
    Fees 2

    Street Shares offers long-term business loans that can have funds in your account in as soon as a few hours. Street Shares is another peer-to-peer lending organization that offers competitive rates and fast same-day funding. In order to qualify, borrowers must be U.S. citizens and have been in business for at least one year. Street Shares doesn’t charge an application fee or prepayment penalty, so borrowers are free to pay off their loan anytime. The lender is particularly interested in helping small business owners who are veterans, so you may want to give it special consideration if you’ve served in the armed forces.

    In The News
    In the News:

    If you need a PPP loan, a short-term loan or long-term business loan to help your business survive through the pandemic, StreetShares is another investment company with available options. It also provides information on loan forgiveness if you are not able to pay it back.

    Best for early payoff discount – National Funding

    National Funding’s unique payment plans make it stand out against competitors, as well as its high loan amount. Furthermore,instead of prepayment penalties, it offers early payment discounts for qualified borrowers.

    APR Range
    Undisclosed
    Loan Amount
    $5K–$500K
    Term
    Undisclosed
    SimpleScore
    4 / 5.0
    close
    SimpleScore National Funding 4
    Median APR N/A
    Loan Amount 4
    Product Variety 4
    Resources 5
    Fees 3

    National Funding offers fast, reasonably priced loans, with a discount for early payoff. National Funding offers small business loans with reasonable rates. You can prequalify for a loan, and funds may be deposited into your account in as little as 24 hours. However, it does also offer an early payoff discount, so it might be a good choice if you think you’ll be able to pay off your loan earlier than the term length. Depending on your loan, you may be eligible for a 6% to 7% early payoff discount if you pay off the balance of your loan in full before your contract ends. Overall, National Funding provides a wide variety of loans for a multitude of industries, making it a good choice for plenty of business owners.

    In The News
    In the News:

    If you’re looking for information and resources for maintaining your small business during COVID-19, National Funding provides a lot of that. You can also look at business loans for long-term if you plan on starting a business now.

    Best for small businesses – Funding Circle

    Fast funding is important for small businesses who need the flexibility to cover unexpected growth or unexpected emergencies, which is where Funding Circle excels.

    APR Range
    11.29%–30.12%
    Loan Amount
    $5K–$500K
    Term
    3 months–10 years
    SimpleScore
    3.2 / 5.0
    close
    SimpleScore Funding Circle 3.2
    Median APR 3
    Loan Amount 4
    Product Variety 1
    Resources 5
    Fees 3

    Funding Circle offers peer-to-peer lending services with a special emphasis on helping finance small businesses. Funding Circle is a peer-to-peer lender that helps small businesses secure the funds they need to succeed. The lender has a special focus on small businesses over larger corporations, making it a good fit if you own a small business and are looking for a long-term loan. In order to be eligible, businesses must have been in business for at least two years, and business owners must have a personal credit score of at least 660. There are no prepayment penalties, so you can repay your loan at any time. Funding Circle does charge an origination fee of 3.49% to 6.99%, which is automatically deducted from your loan. You can have funds in your account as soon as the next business day, so Funding Circle is a good option if you prefer not to have to wait.

    In The News
    In the News:

    According to Funding Circle’s website, “Funding Circle is working diligently with the U.S. Government to understand what we can do during this unprecedented time and what exactly we can provide to the small business community. Our goal is to work through this to keep our borrowers safe and healthy, both physically and financially.”For more information, visit its resource page

    Best for credit card customers – American Express

    American Express business loans are good for businesses that already use the credit card giant’s products. But its low loan amounts hold it back from better marks.

    APR Range
    6.98%–19.97%
    Loan Amount
    $3,500–$75K
    Term
    6–36 months
    SimpleScore
    3.4 / 5.0
    close
    SimpleScore American Express 3.4
    Median APR 4
    Loan Amount 2
    Product Variety 2
    Resources 5
    Fees 4

    For business owners who already have an American Express card, the lender also offers competitive priced long-term business loans. American Express is best known as an issuer of credit cards with robust rewards programs. However, the company also issues business loans that can help businesses to get ahead. Loan amounts start at just $3,500, so they’re a good fit whether you need a small amount of money or a large influx of cash up to $75,000. Applicants can receive a decision in seconds, and applying won’t affect your credit score. If approved, you’ll receive your funds within 3 to 5 business days. American Express is a good choice if you already use its credit card services since business loans are only available for existing members.

    In The News
    In the News:

    In terms of small business loans, at the moment, American Express  says it is doing its best to help its  customers, but there are longer than normal wait times. It does have financial relief programs for account holders, and it launched the “Stand for Small” coalition to support small businesses who have been impacted by the pandemic.

    What is a long-term business loan?

    Long-term business loans usually come with higher loan amounts and longer-term lengths than traditional short-term business loans. In some cases, term lengths can be as long as 25 years and can represent a substantial investment in the growth of a business. Long-term business loans can be used to purchase equipment, sustainably scale business growth, and invest in the future of your business.

    5-year business loans vs. 10-year business loans

    One of the biggest decisions you’ll have to make is determining repayment terms. If you have more cash flow on hand or are anticipating quicker revenue growth, then a five-year business loan might be a smart option to consider.

    With this, you’ll have to make larger monthly payments, but you’ll pay off the loan quicker. In turn, this reduces the total loan costs, including the interest you’ll pay for the loan.

    Meanwhile, if you want lower monthly payments while you grow your business, then a 10-year business loan might be a smarter option to pursue. With this, you’ll have access to the capital you need with lower monthly payments.

    To see which option is right for you, let’s get practical. Your business needs to borrow $50,000 for expansion costs, and the lender approves you at an interest rate of 6%. If you choose the five-year option, you’ll make monthly payments of $966.64. And your total loan cost is $57,998.40.

    Alternatively, if you choose the 10-year route, you’ll make monthly payments of $555.10. However, with this option your total loan costs are $66,612.30, meaning you’ll pay $8,613.90 more in interest by going with the 10-year over the five-year loan.

    Therefore, if you can afford it, a five-year business loan is going to be a more cost-effective solution.

    Pros and cons of business loans

    Pros:

    • Help start small businesses
    • Used for a variety of purposes
    • Longer repayment terms

    Cons:

    • Lengthy application process
    • Eligibility requirements may apply
    • Fees may apply

    Things to consider before getting a business loan

    Before getting a business loan, it’s important to take several factors into consideration in order to ensure that a loan in general — as well as the type of loan you’re thinking of taking out — is right for you.

    • What are the requirements for the loan? There is no point considering other factors unless you’re sure you meet the lender’s initial requirements. Usually this means that your business has been in operation for a certain period of time or that your business does a certain amount in annual or monthly sales.
    • Term length. For long-term business loans, you will have longer to pay back the loan, usually six to 12 years — or longer. While this may mean lower monthly payments, it also means you’ll pay more in interest over the life of the loan.
    • What are the fees for a long-term business loan? Lenders may charge a variety of fees, including late fees, origination fees deducted from your loan amount and prepayment penalties if you pay the loan off early. Read the fine print of your long-term business loan agreement before signing the dotted line so you know all the fees that will apply to your loan.
    • When is your first payment due and what will your long-term business loan interest rates be? Small business lenders may defer the first payment for up to 90 days, but it’s typically only the first month — and during this deferment, interest will begin accruing. If you have a high small business loan rate, then you may want to start making payments on your loan immediately.

    [ More: A Loan to Build a Dream On: Where to Find Small Business Funding ]

    How should I choose the right long-term business loan?

    The right long-term business loan for you depends on a number of factors, including how you plan to use the loan and what loans you’re eligible for. If you’re a successful and well-established business, you may be able to qualify for competitive SBA loans. If not, there are a variety of other options available, including loans for equipment financing, loans specifically for small businesses, and more. In order to choose the right long-term business loan for you, you should:

    • Research different lenders and loan options.
    • See which loans you’re eligible for based on lender requirements, and check if you’re able to prequalify.
    • Compare rates in order to ensure you’re getting the best deal possible.
    • Consider additional perks, like early payoff discounts and same-day funding.
    • Secure all necessary personal and business documents, including annual income and tax info.
    • Apply to the loans that best suit your needs.
    • Select a loan that offers the best possible rates and benefits.

    How to qualify for a long-term business loan

    To qualify for a long-term business loan, there are a few steps you should complete:

    • Research different loan providers: Be sure to do your research on lenders and note the eligibility requirements for each application. Many of them will consider certain years in business, monthly or yearly revenue and credit score requirements.
    • Gather important documents and info: Gather the information to satisfy the requests that a lender will make in order to come to a lending decision for your application, such as payroll, revenue, credit score and more.
    • See if you prequalify: In some cases, you may be able to prequalify for a long-term business loan, which can give you a better sense of what loans work for you and won’t harm your credit.
    • Officially apply for a loan: Once you’ve done your research and prequalified for any loans that offer it, apply for the long-term business loan that best meets your needs.

    To qualify for a long-term business loan, you’ll also need to meet the lender’s requirements. In almost all cases this will include:

    • Time in business: Many lenders will require your business to be open for at least a year while some might require more time than that.
    • Revenue: Almost all lenders have a goal your company’s revenue must exceed to qualify for a loan.
    • Credit history: Lenders also want you to show you exude sound financial behaviors. On this end, there is a personal credit score requirement, though this can vary widely depending on the lender. Along with your credit score, lenders look to see if you have any tax liens, foreclosures, or bankruptcies on your credit report. If you have any, it could disqualify you from many lenders.
    • Location and industry: Lenders also limit the states they service and the industries they’ll lend to. To demonstrate, some lenders won’t work with nonprofits.

    Business loans FAQ

    In order to get a business loan, you usually need a credit score of at least 660. If you have bad credit, you may need to take out a secured business loan or have a cosigner.

    A business loan is not that hard to get, but also not that easy. Each lender has different requirements, and as long as you meet those requirements (minimum credit score, business running for at least one year), you should have no problem getting a business loan. Some applications won’t impact your credit score, either.

    To get a business loan, you must first research different lenders and their loan programs to see what you’d be eligible for and what would be a good fit for you based on the terms and conditions.

    If your business loan application got denied, it’s likely because you did not meet all the requirements. Perhaps your credit score is too low, your business’ income is not high enough, or your business has not been in operation long enough. If your application got denied, you will receive a letter in the mail detailing exactly why you were denied.

    If you have a strong revenue stream, a good credit history, and need more capital to reach your company’s next objectives, then a long-term business loan might be right for you. Once you choose to do a long-term business loan, you’ll want to consult with a financial advisor on how much you should borrow and repayment terms.

    This is where long-term planning comes in handy. When considering how much you should take out, consider the future expenses of your business in the next five to ten years. How many more people are you going to hire? What equipment will you need? Answering these questions can help you determine the amount you need.

    A long-term business loan can be beneficial in that it provides you the capital you need now to expand your business, hire more staff, and add any equipment that can boost your revenue. What’s more, with the longer repayment terms, you’ll have lower monthly payments, so it doesn’t take a huge chunk out of your cash flow.

    We welcome your feedback on this article and would love to hear about your experience with the business loans we recommend. Contact us at inquiries@thesimpledollar.com with comments or questions.

    Methodology

    SimpleScore

    We’ve created the SimpleScore to help you objectively compare products and services here at The Simple Dollar.

    Our editorial team:

    • Identifies five factors to compare across each brand
    • Determines the rating criteria for each factor
    • Calculate an average of those five factor scores to get one SimpleScore™

    We break down each of these five factors and their rating criteria for our review of the best auto loan companies of 2020.

     

    Why do some brands have different SimpleScore on different pages?

    Some brands offer a variety of financial products, which is why they have different SimpleScores on different pages. We rate individual products that brands offer — not the brand as a whole. 

    For instance, in our American Express personal loans review we rated the company a 4.25 out of 5 based on rates, loan amount, customer satisfaction, customer support and fees. In our review of the best small business loan rates, American Express earned a 3.4 out of 5 SimpleScore based on its business loan product. By tailoring our SimpleScore to each financial solution, we’re able to give you a more accurate view of each brands’ services and how they compare to competitors’ products.

    Median APR

    Lenders with a lower median APR are awarded higher scores — because even if you’re APR is average, your business is not.

    Maximum loan size

    Lenders that dole out loans with high maximums are also rewarded with higher scores. It takes money to run a business, and businesses need access to as much capital as it takes.

    Product variety

    Need more than just a business loan? Lenders that offer more than one type of financial product for businesses score higher than others that don’t.

    Educational Resources

    We gave out higher scores to lenders that have the following subjects covered in their blogs: loans, marketing, employee and staff, and credit or finance resources.

    Fees

    Fees can add up fast and eat into operating costs –– that’s why we give a higher score to lenders that have fewer fees.

    Sean Jackson

    Contributing Writer

    Sean Jackson is a creative copywriter living in Florida. He’s had work published with Realtor.com, theScore, ESPN and the San Francisco Chronicle. In his free time, Sean likes to play drums, fail miserably at improv and spend time at the beach.

    Reviewed by

    • Courtney Mihocik
      Courtney Mihocik
      Loans Editor

      Courtney Mihocik is an editor at The Simple Dollar who specializes in personal loans, student loans, auto loans, and debt consolidation loans. She is a former writer and contributing editor to Interest.com, PersonalLoans.org, and elsewhere.