Best Personal Loans for Business of December 2024

Few lenders let you use a personal loan for business expenses. Of those that do, Upgrade may be the best choice. It offers loans up to $50,000 with repayment terms of up to seven years and considers applicants with fair credit. That said, it's generally preferable to get a business loan through a bank or the Small Business Administration (SBA) — provided you and your business qualify.

Compare personal loan rates for business of December 2024

Best personal loans for business

In certain situations, it may make sense to use a personal loan for business expenses, like if you need money for a startup business and can’t qualify for an SBA loan or need money sooner than you can get with an SBA loan. The best personal loans for business have large loan amounts, low interest rates and fees, and fast funding. The lenders below all offer business funding — but you may need to reach out directly to qualify.

Methodology

Credible evaluated the best personal loans for business based on factors such as customer experience, minimum fixed rate, maximum loan amount, funding time, loan terms, fees, discounts, whether cosigners are accepted, and whether business loans are allowed. Credible’s team of experts gathered information from each lender’s website, customer service department, directly from our partners, and via email support. Each data point was verified by a third party to make sure it was accurate and up to date.

Learn more about how Credible rates lenders by exploring our Personal Loans Lender Rating Methodology.

How to compare lenders

Obviously, low interest rates and few or no fees are ideal. But your business needs may dictate specific loan amounts, funding times, and repayment terms that limit your personal loan options. Itemize the needs of your business, and also consider the following when comparing lenders.

• APR: The annual percentage rate indicates how much you’ll pay for your loan, expressed as a percentage of the total loan amount. It’s similar to the interest rate, but also accounts for any upfront fees, like an administrative or origination fee. The lower the APR, the better.
• Fees: There are several types of fees associated with personal loans, though they vary widely by lender. Common fees include origination fees, which are typically subtracted from your loan funds before you receive them, and late fees.
• Loan amount: Your business needs will determine the size of the loan you apply for, while your ability to make payments, in part, will determine how much you qualify for. While personal loans are often capped at around $50,000, certain lenders offer higher amounts.
• Repayment terms: A loan’s repayment term is the amount of time you have to repay it. This has a direct impact on the size of your monthly payments, which impacts the loan amount you qualify for. Longer terms generally have smaller monthly payments, but you’ll pay more in interest over time. Shorter terms are likely to come with higher monthly payments, but you could save on interest.
• Funding time: Certain lenders offer same-day or next-day funding once your application is approved, while others may take up to a week to fund your loan. If your business needs are urgent, choose a lender that offers fast funding.

Learn More: APR vs. Interest Rate on a Personal Loan

Can you use a personal loan for business?

Some lenders allow personal loan funds to be used for business purposes, but many don’t. You might consider this route if you need capital but can’t qualify for a traditional business loan.

Fortunately, personal loans may be easier to qualify for than business loans. You don’t need to provide details about your business to get a personal loan, and you don’t need to generate a specific amount of revenue or have a business credit score to qualify. If your business is still new — or if you’re looking for funds to get your business off the ground — a personal loan might be a good fit.

To find a personal loan to use for business expenses, look for lenders with no restrictions on business use.

SBA loans vs. personal loan

An SBA loan is a type of business loan guaranteed by the Small Business Administration. Because the SBA backs these loans, they’re less risky for lenders. They also have more guidelines regarding how you can use them. Below, we compare different aspects of SBA and personal loans.

Pros and cons of a personal loan for business

Before taking out a personal loan for your business, compare the following pros and cons:

Pros:

• Fixed monthly payments could make budgeting easier.
• Generally unsecured, meaning you wouldn’t need to provide collateral to qualify.
• Can provide fast funding — sometimes within a day.
• Fewer qualification requirements than business loans, and often easier to get.

Cons:

• APRs can be higher than on business loans.
• If you miss a monthly payment, it could hurt your personal credit score.
• Lower loan maximums in general compared to business loans.
• Repayment periods may be shorter than on business loans.

How to get a personal loan for business

The process of getting a personal loan for business is the same as getting a personal loan for any other use. And because a personal loan application doesn’t take your business details into account, it’s generally easier than applying for a business loan. Here’s how it works:

1. Compare lenders: Research and compare various lenders to find a loan that works for you. Consider APRs, fees, repayment terms, and loan amounts.
2. Prequalify: Prequalifying can give you an estimate of the rates, amounts, and terms you may be eligible for. Get prequalified when possible to make comparison shopping easier, but remember it is not an offer of credit, and your final rate could differ. Prequalifying won’t affect your credit, but proceeding to apply for a loan will.
3. Choose a loan and apply: Once you settle on a lender, apply for the loan. Many lenders have an online application. You’ll likely need to provide your ID, proof of address, proof of income, and more. Check with the lender for specific application requirements. It is at this point that the lender will conduct a hard credit pull, which can lower your score by a few points for up to a year.
4. Get your funds: If the lender approves your loan, you’ll receive a loan agreement to sign. Once you sign, you’ll get your funds. Depending on the lender and how it disburses your loan, you could get money within a day.

Learn More: How To Get a Personal Loan

Compare Personal Loans

Alternatives to a personal loan for business

While a personal loan can be a smart way to invest in your business, there may be better options. Consider the following alternatives to using a personal loan for business:

• SBA loans: SBA loans are business loans backed by the Small Business Administration. You can get them from a wide range of lenders, but your business has to meet certain eligibility requirements to qualify.
• Business lines of credit: Like a personal line of credit, a business line of credit gives you access to revolving credit, so you only borrow what you need.
• Business credit cards: A business credit card is similar to a personal credit card — it’s a revolving source of credit, and you pay interest on the unpaid balance. Business credit cards often have added perks and rewards, like points for travel and dining. But interest expenses can accrue rapidly if you keep a balance on the card.
• Grants: Grants are a great way to fund your business because, unlike loans, you don’t have to repay them. The trick is finding grants you and your business are eligible for. The federal government, state governments, and private companies all offer grants for small businesses. Resources like Grants.gov, the U.S. Economic Development Administration, and the Small Business Development Centers can help.

Loan Amounts:

• $2,000 Loan
• $5,000 Loan
• $10,000 Loan
• $30,000 Loan
• $40,000 Loan
• $45,000 Loan
• $60,000 Loan
• $80,000 Loan
• $100,000 Loan