Best Restaurant Loans 2016

Small Business, Small Business Loans
Small-Business Loans for Your Restaurant Startup and Beyond

When you’re dreaming of opening a restaurant, it’s easy to overlook the nightmares: broken equipment, customer gripes, employee turnover. The financial requirements, in particular, can be overwhelming, even for the savviest business owners.

That’s why running a restaurant often requires funding, whether it’s from investors, business credit cards or small-business loans.

But not all business loans are created equal. Certain financing will be a better fit, depending on how you plan to use the funds. When doing your homework, check out the range of small-business loans that could work for your restaurant.

Restaurant loans for everyday expenses

You’ve made it through the first year running your restaurant, but your stove is on the fritz and your cash flow is a little spotty. Finding financing to help cover the cost can be tricky since you’re not very well established, but both Kabbage and StreetShares offer working capital loans to newer businesses. If your credit is lacking, Kabbage’s qualifications are linked to alternate data sources, such as bank accounts or payment systems. Alternatively, StreetShares is a peer-to-peer lender that connects you to investors with similar backgrounds and interests, which helps drive down default rates — and, in turn, interest rates.

kabbage
Street Shares
Good option for:
• Bad personal credit
• Fast cash
• Good personal credit
• Veterans
• Newer businesses
Do you qualify?
• No minimum credit score
• 1+ year in business
• $50,000+ annual revenue
• Must have a business checking, payment platform or accounting software account

• 600+ credit score
• 1+ year in business
• $25,000+ annual revenue
Borrow:
$2,000 to $100,000$2,000 to $100,000
APR:
32% to 108%9% to 40%
Learn more at Kabbage
Learn more at StreetShares


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Restaurant loans for inventory

Food costs are a top challenge for restaurants, and those costs are rising, according to the National Restaurant Association’s 2015 industry forecast. If you need cash to buy nonperishable ingredients or paper goods for your restaurant in bulk, Dealstruck offers an inventory line of credit to help you cover the cost. OnDeck is another solid option for a line of credit. Unlike Dealstruck, though, OnDeck’s line of credit can be used for both perishable and nonperishable items.

bluevineondeck

LINE OF CREDIT

Dealstruck
Good option for:
• Good personal credit
• Flexible cash
• Newer businesses

• Good personal credit
• Businesses with strong cash flow
• Retail or food service businesses
• Good personal credit
• Recurring inventory purchases

Do you qualify?
• 600+ personal credit score
• 6+ months in business
• $60,000+ annual revenue


• 600+ personal credit score
• 9+ months in business
• $75,000+ annual revenue
• 600+ credit score
• 1+ year in business
• $150,000+ annual revenue
Borrow:
$5,000 to $50,000Up to $100,000Up to $500,000

APR:
16% to 62%14% to 40%22%, plus prime rate
Learn more at BlueVine
Learn more at OnDeck
Learn more at Dealstruck


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Restaurant loans for established businesses

You’ve been around a few years and are going strong. Now you’re looking for financing to renovate or open a second location. SmartBiz and Funding Circle offer low-cost term loans to help you meet larger expenses. SmartBiz provides SBA loans through its online platform, connecting you with some of the lowest rates among online alternative lenders. Funding Circle is a peer-to-peer online lending marketplace that matches accredited and institutional investors with already successful small businesses looking for long-term growth.

smartbiz
fundingcircle
Good option for:
• Good personal credit
• Long-term capital
• Low rates
• SBA loans
• Good personal credit
• Established businesses
• Growth capital
Do you qualify?
• 600+ minimum credit score
• 2+ years in business
• $50,000+ annual revenue
• 620+ personal credit score
• 2+ years in business
• No minimum annual revenue required
Borrow:
$30,000 to $350,000$25,000 to $500,000
APR:
7% to 8%8% to 33%
Learn more at SmartBiz
Learn more at Funding Circle

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Want to compare more financing options?

NerdWallet has created a comparison tool of small-business loans to meet your needs and goals. We gauged lender trustworthiness, market scope and user experience, among other factors, and arranged the lenders by categories that include your revenue and how long you’ve been in business.

Compare business loans

 
For free, personalized answers to questions about financing your business, visit the Small Business section of NerdWallet’s Ask an Advisor page.

Jackie Zimmermann is a staff writer at NerdWallet, a personal finance website. Email: jzimmermann@nerdwallet.com. Twitter: @jackie_zm.

This article was updated June 21, 2016. It was originally published Aug. 24, 2015.

 

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