515 N Flagler Dr Ste P300, West Palm Beach FL 33401-4326
For personal assistance, call
Get Started

2020 Guide to the Best Bad Credit Business Loans


Bad credit business loans: Everything you need to know

If you’re a business owner in need of a loan, but you have bad credit, what are your options? And what should you know going into the process looking for a bad credit business loan?

Below, we’ll cover everything you need to know about bad credit business loans and get you on your way to obtaining the funds your business needs.

Can you get a business loan with bad credit?

In the past, banks controlled small business financing and anything less than a 700 credit score just didn’t cut it.

But now? Fortunately, that answer is a resounding yes.

So, how can you be approved for a business loan with bad credit if that was such a weighty requirement in the past?

Through the advancement of financial technology via the fintech revolution, and the understanding that running a business can leave your credit score in bad shape, a more comprehensive approval process has been developed.

Options that focus on the present and the future and no the past.

Bad credit small business loans typically gauge your cash flow and revenue instead of focusing on your credit.

Many great options for bad credit business loans are now available– options that weigh the strength of your business as a whole, from cash flow to your debt-service coverage ratio, instead of just your credit score and financial statements.

By balancing these additional factors, lenders can obtain a better overall view of your business’ health and offer you capital even with bad credit, provided your business is stable and profitable.

Now, you can get the funding your business needs to grow with less than perfect credit.

Bad credit business loans – The Excel Capital Way

Small business owners are often turned away by traditional lenders when they have a less than perfect credit history. You may have experienced this first-hand.

Sure, your credit score matters. But it doesn’t tell the whole story and it isn’t a completely accurate assessment of risk (which is what lenders use to qualify you for funding).

At Excel, we realize that when starting a business, sacrifices sometimes need to be made to pave the way for a brighter future.

We believe there’s more to the story of your business. And we believe in your opportunity to grow your business to its full potential with access to capital when it matters most.

With options that require no personal guarantee or collateral as well as funding (and approval) in as little as 24 hours, Excel Capital can give your business the funds it needs to move your business forward, in good times and bad– and even with bad credit.

 Complete our online application and see how much you can be approved for: Apply Now

What credit score is needed for a business loan?

Firstly, what exactly is considered ‘bad credit’?

There are several credit scoring models, whether it be from VantageScore or FICO, however, the most widely accepted model (FICO) is shown below:

The basic FICO scoring model breaks credit scores into 5 major buckets

Traditional vs Alternative Funding

While every type of loan is different, a credit score of over 700 is typically required for traditional bank loans. In contrast, many alternative business loan products have no credit score requirement at all. And, of those that do, credit score requirements are low. In the <fair> (580+) range, significanlty  lower than traditional business bank loans.

FICO Score Breakdown:

  • 800 to 850 is exceptional
  • 740 to 799 is very good
  • 670 to 739 is good
  • 580 to 669 is fair
  • 300 to 579 is generally the ‘bad credit’ range

And this basic scoring model uses these parameters to generate your score:

What Factors Impact Your Credit Score?

How your credit score is calculated

Payment history: 35%
Credit utilization: 30%
Credit history: 15%
Credit mix: 10%
New credit: 5%

*Payment history + credit utilization ( referring to what % of your available credit you’re actively using) account for 2/3 of your entire score’s calculation.

Keep in mind, as mentioned above, there is no one single accepted scoring model for all types of loans. Each type of loan uses a slightly different model. However, this is the most common.

Typically, a credit score of over 700 was required for traditional bank loans (and that’s still the case today).

However, many alternative business loan products have no credit score requirement at all. And, of those that do, credit score requirements are low, in the “fair” (580+) range, significantly lower than traditional business loans.

Is personal credit or business credit used for business loan approval?

It’s important to note that when we say credit score, we’re talking about your personal credit score, not your business credit.

That’s a really important distinction, partly because personal credit is much easier to fix than business credit.

It’s also important because a lot of business owners think their business credit is the main factor for consideration when applying for a loan.

In most cases, the only lenders that will look at your business credit are traditional lenders such as banks.

Alternative, or non-bank, lenders such as Bizfi and Paypal working capital focus on your personal credit score when evaluating business funding with bad credit, so that’s what we’re talking about here.

Many business owners in the state of Florida are looking for small business loans florida bad credit. Although we fund all 50 states our biggest percentage of clients are in New york, California, Texas and Florida.

Action Step: Get your personal credit report

Before we get into what kind of loan your credit might be able to get you, it’s important to get your most up to date credit report.

If you haven’t checked your personal credit report in a while, don’t worry, it’s easier than ever to get your report for free (assuming you haven’t gotten it already this year).

Once a year, you can get your personal credit report from Annualcreditreport.com (technically, the only authorized website for free credit reports), so grab that now so you know the information you’re working with is current.

How can we fund you even if you have bad credit?

There are several reasons why we can fund you if you have bad credit.

However, the most important point is what we touched on above: there’s more to your business’ health than just your credit score and the items on your credit report.

Your credit report includes a series of snapshots. It could include accounts from several years ago.

Chances are, you’re not the same person– and your business isn’t in the same position– then when you missed those payments or defaulted on that loan.

Lenders will still take note of it. But again– it’s not the whole story.

Our process is different from traditional lenders. We take several factors into consideration that tell a more well-rounded story of the health of your business.

What is your cash flow like? How much debt do you have? What is the difference between the two? Are you on a growth trend or is your business cutting staff because the industry is being phased out?

There’s so much more to your business than just your credit score and it’s our goal to offer a fairer and more ‘complete’ system for loan approval than traditional lenders.

Complete our online application and discover how much you can be approved for: Apply Now

Types of bad credit business loans

Unsecured business loan

Below are several alternative financing options, all with their own specific benefits, and based on different financial needs. No matter what stage you’re at in your business, there’s a vehicle that will help you get the funding your business needs.

Unsecured Business Loan Quick funding, limited paperwork Loan amount: $5,000 – 5,000,000 Repayment terms: 3 – 24 months Minimum Credit score: 500+ Additional minimum requirements: $100,000 annual revenue, 3 months in business Speed: Approval in 24 hours, funding in 1 business day

An unsecured business loan is a loan based primarily on your cash flow and gross sales, up to as much as $2,000,000.

An unsecured business loan does not require any form of hard collateral, making it a safe and effective option for virtually any business.

A lender may require you to offer a type of limited collateral as security if you can’t repay the loan. However, typically, this is only a percentage of future sales and not something such as property or cash savings. And that means if you go out of business, you’re not required to pay back the loan.

In addition, because they’re unsecured, interest rates tend to be higher. So, keep that in mind when deciding which financial vehicle is best for your business. 

Learn more about unsecured business loans.

Merchant cash advance / Split funding

Split funding, also known as a merchant cash advance, remits (or deducts) a percentage of your daily credit card sales to repay the loan. This makes them great for businesses whose cash flow fluctuates, making it difficult to make consistent, on-time monthly payments throughout the year.

Merchant Cash Advance Business owners who accept credit cards Loan amount: $5,000 – 5,000,000 Repayment terms: 3 – 18 months Minimum Credit score: No minimum Additional minimum requirements: $100,000 annual revenue, 6 months in business Speed: Approval in 24 hours, funding in 1 business day

When business is good a larger amount is deducted. However, when cash flow is down, that amount is smaller, helping your business adapt with your fluctuating cash flow. Because of the nature of this type of loan, consistent cash flow from credit card sales is required for approval.

Learn more about Merchant Cash Advances

Term loan

This includes both short-term and medium-term loans, each designed to fill either a short-term or medium-term business need. Think of it as a quick infusion of cash for a specific purpose such as new equipment, hires, or extra material before a busy season. These types of loans are ideal when you specific lump sum for a one-time purchase or cash boost.

Term Loan Those need a quick infusion of cash Loan amount: Funding over $75,000 may require additional documentation Repayment terms: 2 – 5 years Minimum Credit score: 680+ Additional minimum requirements: $500,000 annual revenue, 2 years in business Speed: Approval in 24 hours, funding in > 72 hours

Learn more about term loans.

Business line of credit

Similar to a credit card, a business line of credit is a revolving credit amount which you can use continuously as the need arises. This is a trade-off for lower loan amounts and higher interest rates. If you have high seasonality, making your cash needs much greater during one part of the year than the rest, a business line of credit could be ideal.

Business Line Credit Cash Flow Loan amount: $2,500 – 2500,000 Repayment terms: 6 – 12 months revolving Minimum Credit score: 550+ Additional minimum requirements: $500,000 annual revenue, 1 year in business Speed: Approval in 30 minutes, funds instantly

Business lines of credit don’t require collateral. However, due to that, your credit score generally needs to be on the high end of bad to fair (540+).

Learn more about business lines of credit.

How to get a business loan with bad credit

So, now you know your options. But what will you need to apply– and get approved– for a bad credit business loan?

First, let’s look at what lenders typically look for in applicants so you can maximize your chances of being approved.

What do lenders look for?

As far as your credit, these are important things to make a note of:

  • Bankruptcies
  • Foreclosures
  • Tax liens

None of the above disqualify you. However, it’s important to keep in mind that if they were recently placed on your credit report, they will have an impact. So, you’ll want to make sure all your other ducks are in order as best as possible.

However, as we talked about earlier, alternative lenders look at more than just your credit score.

Here are a few more things which are important to keep in mind:

1. Annual revenue

One of the most important factors, annual revenue lets lenders know how your business is doing in the broadest sense.

Is revenue increasing each year? Is it down? This is also an important factor for deciding what size of loan you’re approved for.

2. Current debt obligation

Do you already have a business loan? Are you currently paying it off? And is there collateral involved?

Most lenders don’t like to see that you already have a business loan with someone else.

This doesn’t just mean that it may be harder for you to pay them back. It also means that, in the case of defaulting on a loan and potential matters of collateral, they’ll be “second position”.

That means they will only be able to collect after the first lender does, which a lender does not like to see.

3. Cash flow

We covered annual revenue and profitability, however, cash flow tells lenders much more that neither revenue or profitability can.

Lenders want to see not only how well you manage the money that comes in, whether you properly handle your expenses but also how much spare cash you keep on you at any given time.

If something were to happen tomorrow and your cash flow dips, could you continue to pay your loan off? Lenders want to see that this is the case.

4. Profitability

Closely related to annual revenue, profitability is one of the best ways for telling how effectively you’ll be able to repay a loan.

While annual revenue is important, if you have a huge revenue but very little actual profit, your business isn’t actually doing as well as it looks.

Most Bad credit business loans under 100k do not require a profitability review. However, when the business loans get higher some institutions may request copies of your financial statements to review your bottom line.

What do you need to qualify for a business loan with bad credit?

  1. What do you need to apply?

    Most loan programs require that you’ve been in business for 6 months – 2 years and are in good standing.

    For most programs, there is:

    • No minimum credit score
    • No collateral required
    • And, for unsecured business loans, you need just $10,000 in monthly gross revenue to apply

*Keep in mind that each loan program is structured differently, therefore requirements for application and approval will defer slightly.

  1. …and what documents do you need for approval?

    • Completed application
    • Copies of last 4 months of business bank statements
    • And last 4 months of processing statements (if applicable)
    • Drivers license
    • Voided business check
  2. Documents that may be requested prior to funding (after your application has been submitted):

    • Proof of ownership
    • Profit & loss statement
    • Property lease agreement & landlord contact information
    • Personal and/or business tax returns
    • Business licenses
    • Debt schedule

How to qualify for a business loan with bad credit

Now that you have a better idea of what lenders are looking for when you apply for a bad credit business loan of any kind, what do you need to qualify?

Generally, every one of the loan options we mentioned earlier requires that you’ve been in business for at least six months to one year and are in good standing.

For most loan options, there is:

  • No minimum credit score
  • No collateral required, and
  • For unsecured business loans: you need only $10,000 in monthly gross revenue to apply.

However, keep in mind that any additional requirements all depend on the type of loan. 

If you’re unsure which loan product you’d prefer, don’t worry.

When you submit your information through our short online application, we’ll guide you through the entire process to decide not only which product would be the best fit but also additional requirements you’ll need to complete your application.

In addition to the above, each loan type requires several documents which you’ll need to apply. Let’s talk about those now.

What documents do I need to apply?

Each loan program is slightly different, but the majority of documents are the same across the board.

Here’s a short list of documents which you may be required to provide to complete your application (Hint: they’re not required for submitting an online application, only afterward for approval):

Documents needed for approval:

  • Completed application
  • Copies of last 4 months of business bank statements
  • Copies of last 4 months of processing statements (if accepted at your business)
  • Drivers license
  • Voided business check

Documents that may be requested prior to funding (after your application has been submitted):

  • Proof of ownership
  • Profit & loss statement
  • Property lease agreement and landlord contact information
  • Personal and/or business tax returns
  • Business licenses
  • Debt schedule

Not all of these documents will be required for each program. However, it’s important to know in advance so that you can put your things in order; Especially if you’re looking to receive funds quickly.

How to apply for a bad credit business loan

You’ve reviewed your options, put your things in order, and now you’re ready to apply.

Ultimately, you’re the best judge of what your business needs and when it needs it.

But if you know your business needs cash and not getting it will hold it back from growth– you need to do everything you can move the business forward.

We’ve made it simple and easy to get your business the funding it needs. Often, in as little as 48 hours.

Don’t let bad credit hold your business back from getting the funding it needs to grow.

 Complete our online application and see how much you can be approved for: Apply Now

Frequently Asked Questions (FAQ):

1. How can I improve my bad credit score to obtain a better loan offer?

Qualifying for and obtaining a business loan is just the beginning.

Once you’ve obtained a loan you should turn your focus to improving your business credit score for the future to obtain a better loan the next time around.

Here’s how you can turn your bad credit score into an excellent credit score:

1. Pay your bills on time

The easiest (and likely best) way to improve your bad business credit score quickly is by paying your bills on time. That’s all there is to it.

Now that you have a loan you’re in a unique position to rack up a history of on-time payments and the credit score bump that happens over time from doing so. Both of these will play a big part in getting approved for a better business loan down the line.

Also, if you want to take it a step further and look really good to loan companies make payments in advance whenever possible.

2. Keep your credit lines open

A lot of business owners think canceling all of their credit cards is the best solution when they find themselves in a rut, however, this is one of the worst things you can do.

Closing your credit lines will cause your overall business credit lines to decrease both quickly and dramatically, negatively impacting your overall credit score.

Even if the balance is zero this helps poor credit get better and doesn’t have you pay an interest rate since your not using any of the lines of credit available to you.

Instead, pay off your balances steadily and consult a credit professional if you believe you need additional help.

3. Monitor your balances

Paying your monthly payment and other bills on time is great, but paying down your balances when you can to under 10% will increase your overall credit score tremendously.

So, make sure to monitor your balances and plan payments accordingly so that you stay below that as often as possible.

4. Watch your credit report

Lastly, one of the most important things you can do is monitor your credit report.

Look for errors, chargebacks, items that have been sent to collections, etc. and handle them as you see necessary.

Taking the extra time to make sure your report is accurate and up-to-date can go a long way.

And, with all of these points taken together, the next time you are looking for business funding with bad credit so you can get the best terms possible.


2. What are the benefits of no credit check business loans?

No credit check business loans are beneficial for businesses owners that are looking to keep their credit score in top shape while still obtaining working capital to help grow their business.  

Many unsecured business lenders will do a hard inquiry before extending an offer which can negatively impact your credit score, making it hard to keep a perfect credit score.

For that reason, it’s important to ask for a no credit check business loan when applying for business funding.

By obtaining small business loans with no credit check you can avoid business financing affecting other personal funding that is being worked such as:

  • A home mortgage
  • Car loan applications
  • Home equity lines 
  • or any other personal transactions that are not related to your business.

Many secured business loans have strict guidelines regarding your credit so obtaining a no credit check business loan keeps your traditional funding safely in play.

3. What is a good credit score for a business loan?

Most bank loans require at least a 680 credit score, many as much as 720 and above. However, bank loan approval processes are notoriously lengthy and they require huge amounts of paperwork. As a result, if you’re in need of funds moderately fast, they’re unreliable.

Alternative funding with Excel has no base credit requirement and approval (and payout) is fast– with most loan products being within 24-72 hours. 

4. Does a business loan affect your personal credit?

In some cases, a business loan can impact your personal credit. Some loan agreements require a personal guarantee, in which case the loan will impact your personal credit. In other cases, if you’ve placed personal funds down as collateral it can also affect your personal credit.

If you have bad credit, a business loan is a perfect opportunity to improve your personal credit score substantially. So, take full advantage of that opportunity and make sure to pay each regular payment on time until your loan is paid off. 

The Top 10 SBA lenders by Volume, December 31 2019 (Most Current)

Top 10 SBA Lenders | Excel Capital


Many business owners have heard of SBA funding and how the government backs the loan. However, from our communication with thousands of business owners and first-hand experience with the largest SBA lenders, we found most don’t understand what it takes to get an SBA loan and how the process really works.

So, we have decided to break down the top SBA lenders and give you an opportunity to explore your options. 

Before getting started on this comprehensive guide to the top SBA lenders and what it takes to get approved please review our SBA loan calculator to see if the payment schedule works for your business. To view, the calculator click here

In general, the government does not actually fund your business and there is a pretty extensive underwriting process. It does hold true even in lending – good things take time. That is why an SBA loan can be the right choice for your business.

As a business owner making the decision to start the journey for an SBA loan the first thing to ask yourself is, “where do I start and who do I apply with”?

As a company, we can help with the preliminary review but at the end of the day as a business, you will have to go through one of the key players in the SBA space. Who are they? We put together a list of the largest top 10 SBA lenders below. This is ranked by volume of approval, Total amounts approved along with the average loan amount.

This information is current as of December 31st, 2019 and can be found on the SBA site directly.


What does it take to get approved by any of the Top 10 SBA Lenders?

Every institution has its own in-house guidelines. Every bank is different and has its own policies and leniencies depending on specialty.  This also varies depending on what stage of the business is in its maturity.

We will start with what disqualifies you from getting funding from the SBA

       1. Tax liens – Since these types of business loans are government backed most SBA’s are automatically declined based on tax liens. There are however some circumstances where you can pay off the tax lien with the proceeds of the SBA but the balance needs to be minimal.

       2.  Loss on business tax returns or financial statements – Since the SBA relies heavily on a debt to income ratio (DTI). If the financial statements show a loss many SBA lenders will decline the deal. However, the good news is some things can be backed out of the tax return or financials to show a profit.

2 .a In many situations an owners salary can be backed out of a loss on financial statements to show net positive income. 

2 .b In most situations depreciation can be added to the loss to try to remove the loss in the financial statements.

2.c Interest paid on existing loans can be backed out of financial statements to give your business a little more of a bottom line. Especially if those existing loans will be paid off with the SBA Loan.

     3. Felony records – This is a borderline disqualification and depends what the charge was filed for. According to SBA policy, the SBA will not allow loans to a business whose owner is convicted of a crime of “Moral Turpitude.” Simply put – this is a crime that is related to a violent action or crime involving dishonesty.

      4. Not being able to provide ownership of entity – Simply put the SBA wants to know who they are lending to. If you cannot prove who owns the company you will not be eligible.

      5. Restricted industry – While every SBA lender has their own policy regarding this but a majority of lenders do not lend to the following Industries

  • Ammunition or Weapons Manufacturing; wholesale and retail
  • Bail Bonds
  • Check Cashing Agencies
  • Energy, oil trading, or petroleum extraction or production
  • Federal Reserve Banks, foreign banks, banks, bank holding companies, loan brokers, commodity brokers, security brokers, mortgage brokers, mortgage bankers, mortgage companies, bail bond companies, or mutual fund managers
  • Gaming or Gambling Activities
  • Loans for the speculative purchases of securities or goods
  • Pawn shops
  • Political campaigns, candidates, or committees
  • Public administration (e.g., city, county, state, and federal governmental agencies)
  • X-rated products or entertainment

Now if you find yourself eligible based on the above-mentioned criteria it does not mean you automatically are approved for an SBA. This is just a starting point. As a business, you will now have to go through the application process.

From start to finish most SBA loans that we have helped fund have taken 3 – 4 months from application to funding. 

Documentation Guide for the Top 10 SBA Lenders


SBA Documentation Requirements

   1.  Last 3 years of business tax returns with all schedules, statements, and k-1’s

       a. borrowing company or selling company

       b. in case of a business purchase, both sets will be needed

   2. Year to date interim financials of the borrowing company

       a. Most recent dated balance sheet and income statement

    3. Schedule of Debt/Liabilities

      a. Dated to match balance sheet and income statement / profit and loss statement

      b. Amounts reconcile with supplied balance sheet

    4. Aging Account receivable report and Account payable Aging reports

      a. To match dates for balance sheet and income statement

    5. Affiliate Businesses of borrower where the borrower has a controlling interest

       a. Found on personal tax returns

       b. Form SS4 or Ein assignement letter

       c. Three years filed tax returns

      d. Most recent Interim balance sheet and income statement also knows as Profit and Loss statement

       d. Schedule of liabilities to match dates for balance sheet and income statement

                  I.         Amounts reconcile with supplied balance sheet

     6. Personal Financial Statement (found here)

     7. Most recent personal tax returns with W-2’s, k-1’s, all schedules

      a. If returns are on extension, proof of extension and then year prior returns 

      b. Does borrower have affiliate companies?  If so, see 6 above.

     8. Background of business

     a . Services provided, customers, competition, explain issues with revenues or financials, borrower experience, any other relevant to get a better feel for the borrower

 b. How many current employees?  How many after the loan?  How many positions will be created as a result of the loan?


The SBA has guidelines for startups and existing businesses that are separate.

Yes, a startup can get an SBA loan – The process is a lot more involved and requires a variety of documentation in addition to standard SBA requirements mentioned above.

The top 10 SBA Lenders will Invest in a startup based on the following –

For a projection based loan, startup, or a change in ownership, you will need in addition to the documents above:

     1.Business Plan

      a. Include financial projections and assumptions

          i. 1-3 years or 1-5 years

              ii First year done on month by month basis

         iii. Years 2-3 or years 2-5 done on annual basis

          iv. Provide narrative to assumptions on the projections

     2. Purchase agreement or LOI

     3. Terms of seller debt if any

1. Good managerial experience from future owner/owners
2. At least 680 personal credit score
3. 25% downpayment “Borrower Injection” May come as
gift letter “seasoned”, 401-K, Real-Estate Equity, Proven past injection,
Cash, Etc. Can also be a combination seller-buyer with “Seller Financing”
4. Strong Projections
5. For Profit-Business
6. Operating in the US or approved US territory 7. Collateral “If required”.

If you would like to know more information about SBA Loans or how to get approved by the Top 10 SBA Lenders Feel free to contact us @ 877-880-8086 

If you feel like your business does not qualify for SBA Funding don’t worry Excel is a leader in the Fintech space and has a variety of alternative funding solutions for small business owners. 

Not every business will need an SBA type loan and some might only need funding to fill a short-term need or just need emergency business loans without the waiting time. 

No matter the business we have the top SBA lenders with a solution for you!