LLC Loans: Overview and How to Get One
LLC loans are essentially the same as any other small-business loans, except they're specifically financing your LLC.
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Key takeaways
- LLC loans provide funding for businesses structured as limited liability companies.
- LLC loans can be used for a wide range of purposes, including startup costs, working capital, inventory and equipment purchases, business expansion and debt refinancing.
- To qualify for an LLC loan with the best rates and terms, it’s helpful to have multiple years in operation, good credit and strong finances. There are also loan options, however, for startups and borrowers with bad credit.
If you operate a limited liability company (LLC), a range of business financing options can offer the capital you need. LLC loans can help you fund startup costs, inventory and equipment purchases, business expansion and more.
What is an LLC loan?
An LLC loan is a small-business loan that provides funding for a limited liability company — a type of business structure that functions like a hybrid between a corporation and a partnership.
LLC loans are available from banks, credit unions, online lenders and SBA lenders.
In reality, these products are the same as any other type of business loan — most business loans do not have qualification requirements specific to the legal structure of a business. (Ready to shop? See our list of the best business loans for any business type.)
The right LLC loan for your business depends on factors such as your funding needs and qualifications.
How an LLC loan works
LLC loans are similar to other business loans in how they work. If you are approved by the lender for an LLC loan, you’ll receive the money in a lump sum or be approved for a set amount of funds that can be withdrawn at your convenience.
Depending on the type of LLC loan, you may be asked to offer assets as a way to ensure repayment of the loan. A secured business loan requires collateral, like equipment or another asset, to back up the loan. An unsecured business loan, on the other hand, doesn’t require collateral.
The interest rate you pay may be fixed, meaning it won’t change during the loan term, or it may be variable, which means it’s not set and may go up or down.
The amount and frequency of your loan payments will be decided by the lender. You may be required to make monthly, weekly or daily payments based on the terms in the business loan agreement.
🤓 Nerdy Tip
Almost all LLC loans require a personal guarantee. A personal guarantee overrides the liability protections you, the business owner, typically get when creating a limited liability company. By signing a personal guarantee, you agree to repay the debt if your business fails to pay. In the case of default, the lender can seize your personal assets to cover its losses. Best LLC loan options
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| Product | Max Loan Amount | Min Credit | Min Time In Business | |
|---|---|---|---|---|
 Fora Financial - Online term loan Nerdwallet Rating with Fundera by NerdWallet | $1,500,000 | 570 | 6 months | with Fundera by NerdWallet |
 SBA 7(a) loan with Fundera by NerdWallet | $5,000,000 | 650 | 24 months | with Fundera by NerdWallet |
 OnDeck - Online term loan Nerdwallet Rating with Fundera by NerdWallet | $250,000 | 625 | 12 months | with Fundera by NerdWallet |
 Bluevine - Line of credit Nerdwallet Rating with Fundera by NerdWallet | $250,000 | 625 | 12 months | with Fundera by NerdWallet |
 National Funding - Equipment financing Nerdwallet Rating with Fundera by NerdWallet | $150,000 | 600 | 6 months | with Fundera by NerdWallet |
 altbanq - Online term loan Nerdwallet Rating with Fundera by NerdWallet | $10,000,000 | 650 | 12 months | with Fundera by NerdWallet |
 Fundbox - Line of credit Nerdwallet Rating with Fundera by NerdWallet | $250,000 | 600 | 3 months | with Fundera by NerdWallet |
 Rapid Finance - Online term loan Nerdwallet Rating with Fundera by NerdWallet | $1,000,000 | 650 | 3 years | with Fundera by NerdWallet |
 Bank of America Business Advantage Unsecured Term Loan Nerdwallet Rating with Fundera by NerdWallet | Undisclosed | 700 | 24 months | with Fundera by NerdWallet |
 Wells Fargo Small Business Advantage® Line of Credit Nerdwallet Rating | $50,000 | 680 | N/A |
How to get an LLC business loan
You can get a business loan for your LLC by following these steps:
1. Review LLC loan requirements
Understanding typical business loan requirements can give you a solid idea of the types of financing that will likely be available to your LLC. Although qualifications vary from lender to lender, they’ll likely consider:
- Personal credit score. You’ll likely need a personal credit score of at least 690 to qualify for business loans with the most competitive rates and terms. You can get a free personal credit score with NerdWallet and review your business credit score through Equifax, Experian and Dun & Bradstreet.
- Time in business. Banks and SBA lenders usually lend to businesses that have been around for at least two years. Online lenders offer more flexibility to newer LLCs. For example, OnDeck’s term loan requires 12 months in business, while Fundbox’s business line of credit is available to businesses that have been in operation for just 3 months.
- Annual revenue. Lenders might require you to meet a minimum annual revenue threshold to show the strength of your business finances. Banks will likely ask you to meet higher minimums, whereas alternative lenders may be more flexible. If you are a new LLC that doesn’t have established finances, you may need to opt for financing options that rely on your personal credit instead of business revenue, like a personal loan for business or business credit card.
2. Determine the right type of LLC loan
Every business’s funding goals are different. You should think about what type of loan you want and can qualify for, how much funding you need and how fast you need it.
Here are some of the most common types of LLC loans:
SBA loans
SBA loans for LLCs take many forms. The SBA 7(a) loan is perhaps the most well-known as it provides working capital and can also fund equipment purchases and expansion. About 60% of 7(a) loans issued so far in the 2025 fiscal year have been awarded to LLCs
SBA 504 loans are reserved for businesses that need to buy long-term, fixed assets such as facilities or machinery.
One downside to SBA loans is that getting approved and receiving funding can take a while. SBA Express loans, a type of 7(a) loan, offer faster funding, but max out at $500,000.
Term loans
Term loans are lump sums of money that you repay (with interest) over a fixed repayment timeline. Eligible business owners can typically borrow anywhere from $2,000 to $5 million with a small-business term loan.
Funding generally comes through quickly, sometimes in a matter of days, if you go through an online lender. But online loans will likely be more expensive than SBA options or those from a traditional bank.
Business lines of credit
A business line of credit can be a flexible alternative to a business term loan. Instead of a lump sum of money, business owners receive a credit line that they can draw on as needed. You’ll only pay interest on the amount you borrow, and smaller credit lines may not require collateral. You may also be able to qualify with a lower credit score.
Equipment financing
Equipment financing is a type of funding designed specifically for the purchase of machinery or equipment. You can get a loan equal to up to 100% of the value of the equipment you’re looking to purchase — and the equipment itself serves as collateral on the loan. In addition to financing the equipment cost, some lenders offer additional financing up to 125%, to cover soft costs such as delivery, assembly and installation.
Like other LLC loan options, you repay an equipment loan over time, with interest.
Because the equipment serves as collateral, you may be able to qualify for this type of financing even if you’re a newer business or don’t have a perfect credit history.
Microloans
Microloans are small-amount loans typically offered by nonprofit lenders. They are often geared toward traditionally underserved borrowers, such as those in low-income communities and those with limited credit histories.
Some nonprofit organizations are designated as intermediary lenders by the SBA which allows them to offer SBA microloans with loan amounts up to $50,000. Because these lenders can set their own lending and credit requirements, SBA microloans may be easier to qualify for than some other types of LLC business loans.
You should also evaluate how much debt you can afford. A business loan calculator can help you estimate interest costs and monthly payments. You don’t want to take out a new loan if you won’t be able to pay it back.
3. Compare LLC loan lenders
Once you have an understanding of your funding needs and qualifications, you can begin researching different small-business lenders.
In general, banks and credit unions offer the best rates and terms, but come with more stringent qualification requirements. Online lenders are faster to fund and offer more flexible eligibility criteria. They usually come with higher borrowing costs than traditional lenders, however, especially if you have poor credit.
Compare several options — considering factors such as interest rates, repayment terms, funding speed and loan amounts — to decide which lenders are best for your LLC.
It can also be helpful to read customer reviews to get a sense of a potential lender’s credibility and reputation. Be wary of any companies that promise “guaranteed approval” or “no credit check,” as these may be predatory lenders looking to take advantage of businesses that are having trouble qualifying for other types of financing.
4. Gather necessary LLC loan documentation
Most lenders will require you to provide some, if not all, of the following as part of your LLC loan application:
- Personal information about you and any other members of your LLC.
- Basic business information and paperwork, such as your employer identification number, LLC articles of organization and business license.
- Personal and business bank statements.
- Personal and business tax returns.
- Business financial statements (e.g., profit and loss statement, balance sheet).
- Collateral information, if applicable.
5. Apply for your LLC loan
After collecting all the necessary paperwork, you’ll complete and submit your application. Online lenders will allow you to apply online and may give you the option to digitally connect your financial accounts in lieu of uploading the required documentation.
Although some bank and SBA lenders may offer an online application process, others may require you to visit a bank branch to apply in person.
6. Review your LLC loan agreement and receive funds
Online lenders may be able to approve and fund your application in as little as 24 hours. Bank and SBA loans, on the other hand, may take anywhere from a few weeks to a few months to fund.
In any case, before signing a business loan agreement, make sure you thoroughly review the terms and conditions and reach out to your lender if you have any questions or concerns.
After you’ve signed the agreement, your lender will release your funds.
» MORE: How to get a business loan
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Alternatives to LLC loans
If you don’t think you can qualify for an LLC business loan — or simply want to explore other financing solutions — here are a few to consider:
- Small-business grants. Grants offer a free form of financing that doesn’t need to be repaid. Although it can be time-consuming to search and apply for small-business grants, they can be an ideal option if you can secure them.
- Personal loans. New LLCs or single-member LLCs with strong credit may consider a personal loan for their business. These flexible loans can offer affordable rates, but will put your personal credit at risk if you can’t pay.
- Business credit cards. Although you never want to exclusively rely on a business credit card for financing, these products can be useful for funding everyday purchases. Credit cards with a 0% intro APR period can be a particularly good option for startups, as long as you don’t build up too much debt that you can’t repay.
- Crowdfunding. Similar to a business grant, crowdfunding can be used to raise money for your business without taking on additional debt. Crowdfunding can also be a way to promote your business and build a loyal customer base.
- Family and friends loans. Business loans from family and friends can be an alternative to an LLC loan. While there’s no formal loan application process for this type of loan, you still want to put the loan details in writing so there are no misunderstandings in the future.
Marianne Hayes, a freelance writer, contributed to this article.
Frequently Asked Questions
Can you get a business loan with an LLC?
Yes. Your business’s legal structure typically shouldn’t impact your ability to get a loan. LLCs can get a business loan as long as they’ve formed their company before submitting a loan application — and provided they meet the lender’s requirements.
Is it hard for an LLC to get a business loan?
Having good credit and strong finances makes it easier to get an LLC business loan. Startups and borrowers with bad credit, on the other hand, may have a harder time accessing financing, especially from traditional lenders. These businesses may consider alternative lending options, such as microloans, personal loans and grants.
Can a new LLC get a loan?
New LLCs may have fewer loan options than more established businesses, but they can still get financing. Online lenders can offer startup loans and may be willing to work with LLCs that only have six months in business. Nonprofits and microlenders may also offer loans to new LLCs, especially those in underserved communities.
Can an LLC get an SBA loan?
An LLC can get an SBA loan as long as it meets the criteria set by the U.S. Small Business Administration in addition to the lender’s requirements. Lenders typically require at least two years in business, good credit and strong business finances.
The SBA requires you to be located and doing business in the U.S., operate for profit and show that you can repay a new loan, among other criteria.
Does an LLC loan affect my credit score?
Taking out a business loan as an LLC will typically protect your personal credit score as well as your personal assets from business debts. However, offering a personal guarantee on a loan to the LLC or pledging personal assets as collateral for an LLC loan allows lenders to come after your personal assets if you default on the loan and could affect your personal credit score.
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- 1. U.S. Small Business Administration. 7(a) & 504 Summary Report. Accessed Mar 25, 2025.
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Our star ratings award points to lenders that offer small-business friendly features. We weigh these factors based on our assessment of which are the most important to small-business owners and how meaningfully they impact borrowers’ experiences. Here’s how we evaluate each lender and the approximate weights we place on each category:
Cost (33%).
Lenders that don’t charge origination fees or prepayment penalties rank higher in this category.Transparency (19%).
Lenders that make it easy for borrowers to understand loan rates, fees, terms, qualification requirements and more rank higher in this category.Underwriting and loan flexibility (15%).
Lenders that have flexible underwriting and offer multiple payment terms rank higher in this category.Credit (11%).
Because it helps borrowers establish business credit, lenders that report timely payments to the commercial credit bureaus rank higher in this category.Application experience (11%).
Lenders that offer fast funding and multiple ways to apply for a loan rank higher in this category.Customer service (11%).
Lenders that provide multiple ways to speak with a customer service representative and an online dashboard for loan management rank higher in this category.
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