United States · Business borrowing · Checked October 29, 2026
Small Business Loans: Compare Funding Before You Apply
Choose the borrowing structure before choosing the lender. A term loan fits a defined, one-time expense; a revolving credit line can serve repeated draws; an SBA-backed loan is a lender-issued option with additional program rules. Compare eligible uses, cash actually received, payment timing, fees and guarantees using proposals for the same business need.
This guide helps U.S. business owners narrow a funding search. Below are two current bank products and an SBA program route, with different purposes and qualifications. Mediplaton is a Korean business-finance publisher and does not accept U.S. loan applications. Follow the official provider links to discuss U.S. funding.
Compare three real financing routes
| Route | Published features | What changes your decision |
|---|---|---|
| Bank of America Business Advantage Term Loan | $10,000–$100,000; one- to five-year terms; $150 origination fee if approved. Published qualifications include two years under current ownership, $100,000 prior-year revenue and typically a personal FICO score above 700. | A lump sum for an established business. Check the quoted rate, guarantee obligations and closing conditions. |
| Wells Fargo BusinessLine | Unsecured revolving line, $10,000–$150,000. Personal guarantees required. First-year annual fee waived; afterward $95 for $10,000–$25,000 lines or $175 above $25,000. | Repeated draws and working-capital timing. Compare the variable rate, drawn balance and recurring fee. |
| SBA 7(a) through a participating lender | Maximum loan amount $5 million; eligible uses include working capital, equipment, real estate and ownership changes. | Program and lender eligibility both apply. The SBA guarantee supports the lender and does not erase the borrower's repayment obligation. |
Official descriptions: Bank of America term loan, Wells Fargo BusinessLine and SBA 7(a). These are different financing structures, not equivalent price quotes. Terms are subject to change and credit approval. We have not ranked these providers from cheapest to most expensive.
Start with one page of funding facts
Write down the purpose, the amount needed, the date each bill is due and the expected repayment source. A single estimate called “growth capital” is hard to compare: split it into equipment, deposits, inventory, payroll and other actual uses. Then separate committed cash from hoped-for sales or an application still under review.
For an equipment purchase, align the expected funding date with the vendor's deposit and final-payment dates. For a recurring cash gap, use the actual collection dates from recent transactions. For an acquisition, separate the purchase consideration from transition costs and cash left for operations. These are planning steps, not approval formulas.
Term loan or credit line?
A defined project with a known total
Ask for a term-loan schedule covering principal, interest, fees and any balance due at maturity. Make sure the quoted amortization period and legal maturity are both stated. Compare the repayment period with how long the funded asset or investment is expected to support the business.
Repeated short-term draws
For a credit line, ask how availability changes as you draw and repay, what triggers a review or renewal, and whether the lender can reduce or suspend access. Do not build a permanent operating budget around a credit limit as though it were cash already in your bank account. A line can help with timing; it does not by itself repair an ongoing loss.
Check eligibility before sending applications
Compare the lender's current operating-history, revenue and credit criteria with your actual records. If a product requires two years under current ownership, do not assume the prior owner's operating history meets that test. Ask the lender how it treats your ownership, industry and intended use of funds.
For an SBA route, confirm current program eligibility, including the business's location, size, ownership and repayment ability. Use a participating lender to check the applicable rules for your situation. An SBA loan is not a general government grant and is not automatically available because a business is small.
Estimate a term-loan payment from your quote
Enter the lender's quoted figures. This estimates monthly payments on a fixed-rate, fully amortizing loan. It excludes fees, variable-rate changes, interest-only periods and balloon payments, and does not calculate a contractual APR.
Compare total obligations, not just the payment
- Match the scope: ask both providers to finance the same uses and explain anything excluded.
- Find net cash: distinguish the contractual loan balance from money received after upfront deductions.
- List every charge: record origination, annual, draw, late, appraisal, legal and early-payoff charges that actually apply. Leave unconfirmed charges as unknown, not zero.
- Read the rate terms: identify a fixed rate or a variable index, margin, reset schedule and any floor. A promotional or “as low as” rate is not your approved rate.
- Read guarantee and security clauses: an unsecured product can still require a personal guarantee. Ask what happens after default and what reporting obligations continue after closing.
When speed matters
Ask what “fast” measures: initial response, conditional approval, signed documents or cleared funds. Get a list of conditions that could delay disbursement. If a supplier deadline is the reason for borrowing, verify the lender can meet it before making a non-refundable commitment. A quicker advertised response is not enough to compare an otherwise unsuitable loan.
Prepare a secure application package
Request the lender's current document checklist. Organize your ownership details, business and personal tax records where requested, financial statements, existing debt schedule, bank records and documents supporting the intended purchase. A new business should label projections clearly. Never turn estimated revenue into historical results to fit an eligibility threshold.
Verify the institution's official site and secure upload process before sending identity, account or tax information. The provider links in this guide are ordinary editorial links, not affiliate application links.
Questions owners often ask
Which lender has the lowest rate?
The public descriptions above do not establish a lowest-cost lender for your business. Request current proposals for the same amount, purpose and payment structure, then include applicable fees and early-exit costs.
Can a startup use the Bank of America product in this table?
Its reviewed published criteria require at least two years under existing ownership. A startup should research an explicitly startup-eligible route instead of treating that product as universally available.
Does an unsecured line avoid personal liability?
Not necessarily. Wells Fargo's reviewed BusinessLine description requires personal guarantees. Read the specific guarantee and loan documents, and obtain legal advice about obligations you do not understand.
What is the next step?
Write your funding purpose and deadline, check eligibility on the official pages, and request comparable written terms from suitable providers. For specialized healthcare projects, see our dental practice financing guide.
Checked October 29, 2026. General business-finance information; the final lender agreement controls. Mediplaton's contact service is for Korean business-finance enquiries and is separate from the U.S. providers discussed here.