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Once we uncover your personalized matches, our team will consult you on the process moving forward.
Here are 5 of the best secured business lines of credit
Lender | NerdWallet Rating▼ | Max loan amount▼ | Min. credit score▼ | Next steps |
---|---|---|---|---|
SBA CAPLines of credit with Fundera by NerdWallet | Best for large funding amounts | $5,000,000 | 650 | with Fundera by NerdWallet |
Bank of America Cash Secured Line of credit Read Review | 4.7/5 Best for new businesses | Undisclosed | 670 | Read Review |
Wells Fargo Prime line of credit Read Review | 4.6/5 Best for established businesses | $1,000,000 | 680 | Read Review |
American Express® Business Line of Credit* Read Review | 5.0/5 Best for low-revenue businesses | $250,000 | 660 | Read Review |
Bank of America Secured Business Line of Credit Read Review | 4.1/5 Best for low interest rates | Undisclosed | Undisclosed | Read Review |
Here are 5 of the best secured business lines of credit
Best for large funding amounts
Best for new businesses
Best for established businesses
Best for low-revenue businesses
Best for low interest rates
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Our pick for
large funding amounts
SBA CAPLines offer up to $5 million — more than other secured credit line options. You can choose from four lines of credit, each designed for a specific purpose, including working capital, seasonal slows, construction and contract orders.
SBA CAPLines of credit
Pros
- Line of credit options for seasonal, working capital, building and contracting needs.
- Large maximum borrowing amounts.
- Competitive interest rates and repayment terms.
Cons
- Typically requires good credit and multiple years in business.
- Slow to fund.
- Collateral and/or down payment may be required.
SBA CAPLines of credit
Pros
- Line of credit options for seasonal, working capital, building and contracting needs.
- Large maximum borrowing amounts.
- Competitive interest rates and repayment terms.
Cons
- Typically requires good credit and multiple years in business.
- Slow to fund.
- Collateral and/or down payment may be required.
Qualifications:
- For-profit U.S. business.
- Unable to access credit on reasonable terms from nongovernment sources.
- Financial qualifications determined by individual lender.
Our pick for
new businesses
Companies with at least six months in operation can use Bank of America’s secured credit line to establish business credit. Timely payments can help borrowers graduate to an unsecured line of credit option.
Bank of America Cash Secured Line of credit
Pros
- Available to borrowers with at least six months in business.
- No origination fee.
- Responsible spending can help you graduate to an unsecured credit line.
Cons
- Credit limit is based on the security deposit you provide.
- Must have a Bank of America checking or savings account to apply.
Bank of America Cash Secured Line of credit
Pros
- Available to borrowers with at least six months in business.
- No origination fee.
- Responsible spending can help you graduate to an unsecured credit line.
Cons
- Credit limit is based on the security deposit you provide.
- Must have a Bank of America checking or savings account to apply.
Qualifications:
- Minimum time in business: Six months.
- Minimum annual revenue: $50,000 per year.
- Bank of America checking or savings account required.
- Minimum deposit of $1,000.
Our pick for
established businesses
Wells Fargo’s secured business line of credit is available in amounts up to $1 million. This credit line is designed for established, high-revenue companies that need to finance larger working capital needs.
Wells Fargo Prime line of credit
Pros
- High maximum credit line amount.
- Competitive interest rates and repayment terms.
Cons
- Can’t apply online.
- Origination fee charged at opening and annual renewal.
Wells Fargo Prime line of credit
Pros
- High maximum credit line amount.
- Competitive interest rates and repayment terms.
Cons
- Can’t apply online.
- Origination fee charged at opening and annual renewal.
Qualifications:
- Minimum time in business: 24 months.
- Minimum annual revenue: Typically for businesses with $2 million to $10 million in annual sales.
- Rates as low as the prime rate + 0.5%, subject to a minimum floor rate of 5%.
Our pick for
low-revenue businesses
The American Express Business line of credit is secured by business assets, and amounts range between $2,000 and $250,000. The minimum annual revenue requirement is only $36,000, or an average of $3,000 per month.
American Express® Business Line of Credit*
Pros
- Streamlined application process with minimal paperwork.
- Financing from $2,000 to $250,000 available.
- Accepts borrowers with a minimum FICO score of at least 660 at the time of application.
- Monthly repayment schedule (as opposed to daily or weekly).
- No prepayment penalties, account maintenance fees or draw fees.
Cons
- Must have online checking or PayPal account to verify cash flow.
- Complex monthly fee structure makes it difficult to compare costs to other lenders.
American Express® Business Line of Credit*
Pros
- Streamlined application process with minimal paperwork.
- Financing from $2,000 to $250,000 available.
- Accepts borrowers with a minimum FICO score of at least 660 at the time of application.
- Monthly repayment schedule (as opposed to daily or weekly).
- No prepayment penalties, account maintenance fees or draw fees.
Cons
- Must have online checking or PayPal account to verify cash flow.
- Complex monthly fee structure makes it difficult to compare costs to other lenders.
Qualifications:
- Minimum FICO score of at least 660 at the time of application. The required FICO score may be higher based on your relationship with American Express, credit history, and other factors.
- Must have started your business at least a year ago.
- Average monthly revenue of at least $3,000.
- All businesses are unique and are subject to approval and review.
- American Express® Business Line of Credit offers two loan types, installment loans and single repayment loans for eligible borrowers. All loan term types, loan term lengths, and pricing are subject to eligibility requirements, application, and final approval. This article contains general information about the American Express® Business Line of Credit installment loan type only.
Our pick for
low interest rates
Bank of America’s secured line of credit can be secured by a blanket lien on business assets or a certificate of deposit (CD). Interest rates are competitive, but you’ll need at least two years in business and a minimum annual revenue of $250,000 to qualify.
Bank of America Secured Business Line of Credit
Pros
- Bank line of credit with competitive interest rates.
- Lender reports to business credit bureaus.
- Bank of America’s Preferred Rewards for Business program can offer interest rate discounts and other perks.
Cons
- Can be slow to fund.
- High annual revenue requirement.
- Charges an origination fee.
- Prepayment fees may apply to early repayments.
Bank of America Secured Business Line of Credit
Pros
- Bank line of credit with competitive interest rates.
- Lender reports to business credit bureaus.
- Bank of America’s Preferred Rewards for Business program can offer interest rate discounts and other perks.
Cons
- Can be slow to fund.
- High annual revenue requirement.
- Charges an origination fee.
- Prepayment fees may apply to early repayments.
Qualifications:
- Minimum of 24 months in business.
- Minimum of $250,000 in annual revenue.
What is a secured business line of credit?
How does a secured business line of credit work?
Unsecured vs. secured business line of credit
Pros and cons of a secured business line of credit
Providing collateral offsets some of a lender’s risk, which may help you qualify for more competitive interest rates and terms.
Offering collateral can help strengthen your application, especially if you’re a startup or have poor credit history.
A lender will typically require documentation about the asset you’re pledging as collateral, and possibly conduct an appraisal, which can slow the application process.
You may be at risk of losing your assets if you fail to repay your line of credit.
Why you might choose a secured business line of credit
- You have collateral. If you have business assets like vehicles, large equipment, commercial real estate or even cash, you may consider using it to make your credit application more attractive to lenders.
- You want more competitive rates and terms. Securing your line of credit with valuable collateral reduces a lender’s risk, which can lead to lower interest rates and more favorable repayment terms for your business.
- You’re looking to build business credit. If your lender reports to business credit bureaus, secured business lines of credit can be a great way to build business credit, though you’ll need to make sure you use the line responsibly and make on-time payments. Established business credit can help your business access more capital, with more affordable rates and terms in the future.
- You want flexible financing. Securing a business line of credit can allow you to access a flexible form of financing. Having a line of credit means you can access capital fairly quickly as needed, but you only pay interest on the amount you draw.
Minimum requirements for a secured business line of credit
Where to get a secured business line of credit
Banks and credit unions
SBA lenders
Online lenders
Methodology
Wondering if you qualify?
It’s possible to get a business loan even if you have bad credit. Bad-credit business loans are available from alternative sources, like online or nonprofit lenders.