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Bank of America Business Loans: 2024 Review

Bank of America offers several types of business loans, low interest rates and rewards for Preferred members — but only established businesses can qualify.
By Randa Kriss
Last updated on January 2, 2024
Edited bySally Lauckner
Fact checked and reviewed

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Our Take

The bottom line:

Bank of America business loans are a good option for established businesses that have existing Bank of America accounts and can take advantage of Preferred Rewards member discounts.
Full review

Bank of America Business Advantage Unsecured Term Loan

Max Loan Amount
Undisclosed
Min. credit score
700

Pros & Cons

Pros

  • Several types of business loans available.
  • Competitive interest rates.
  • Preferred Rewards program can offer interest rate discounts and other perks.
  • Offers specialized commercial real estate, equipment and healthcare practice financing.
  • Fee discounts available for veteran-owned businesses.

Cons

  • Multiple years in business required to qualify.
  • May need to visit a Bank of America branch or schedule a phone appointment to apply.
  • Personal guarantee likely required.

Full Review

Bank of America has the most commercial and industrial loans among U.S. banks at over $329 billion — surpassing the next closest lender by over $127 billion, as of March 31, 2023, according to S&P Global Market Intelligence. Bank of America offers several types of small-business loans, including SBA loans, term loans, business lines of credit, auto loans and equipment financing.
Although you’ll need strong credit and, in most cases, multiple years in business to qualify for a business loan from Bank of America, existing customers can benefit from discounted interest rates and other perks.

How much do you need?

with Fundera by NerdWallet

We’ll start with a brief questionnaire to better understand the unique needs of your business.

Once we uncover your personalized matches, our team will consult you on the process moving forward.

Bank of America is best for borrowers who:

  • Have established businesses. Bank of America requires that your business be under current ownership for at least two years in order to qualify for most types of financing.
  • Are current Bank of America customers. Small-business owners with eligible Bank of America and/or Merrill business bank accounts can qualify for the Preferred Rewards program, which offers interest rate discounts, as well as other benefits.
  • Don’t need cash fast. Bank of America offers limited online loan applications. More likely than not, you’ll need to apply for a business loan over the phone or in person. However, if timing isn’t a top concern you’ll be able to benefit from the competitive interest rates and loan terms that Bank of America can offer.

Types of Bank of America business loans

Bank of America offers several different types of business loans including:
  • Secured and unsecured term loans.
  • Secured and unsecured lines of credit.
  • Business auto loans.
  • Equipment financing.
  • Commercial real estate loans.
  • Franchise financing.
  • Healthcare practice loans.

Bank of America business loans and lines of credit features

Secured Business Loan
Business Advantage Unsecured Term Loan
Secured Business Line of Credit
Business Advantage Unsecured Line of Credit
Cash Secured Line of Credit
Loan amount
$25,000 to $250,000.
$10,000 to $100,000.
$25,000 and up.
$10,000 and up.
$1,000 and up.
Time in business required
2 years.
2 years.
2 years.
2 years.
6 months.
Minimum annual revenue required
$250,000.
$100,000.
$250,000.
$100,000.
$50,000 in annualized revenue.
Fees
Origination fee: 0.5% of financed amount.
$150 origination fee.
Upfront and renewal fees vary based on credit line amount. $25,000 to $100,000: $150 fee. $100,001 to $250,000: $250 fee. Above $250,000: 0.5% of the credit line amount.
None.
No origination fee. $150 annual fee (waived the first year).
Terms
Up to four years when secured by business assets.
Up to five years when secured by certificate of deposit.
12 to 60 months.
Revolving terms with annual renewal.
Revolving terms with annual renewal.
Revolving terms with annual renewal. (Opportunity to move to an unsecured line of credit after 2 years in operation.)
Repayment schedule
Monthly.
Monthly.
Monthly.
Monthly.
Monthly.

Bank of America business auto, equipment and real estate loans features

Business Advantage Auto Loan
Equipment Loan
Commercial Real Estate Loan
Loan amount
$10,000 and up.
$25,000 and up.
$25,000 and up.
Time in business required
Undisclosed.
2 years.
2 years.
Minimum annual revenue required
Undisclosed.
$250,000.
$250,000.
Fees
No application fee.
Origination fee: 0.5% of financed amount.
Upfront fee: 0.75% of financed amount. Additional fees and closing costs such as property insurance, flood hazard insurance and/or appraisal may apply.
Terms
48 to 72 months.
Up to five years when secured by business assets.
Up to 10 years with balloon payment.
Up to 15 years with full amortization.
Repayment schedule
Monthly.
Monthly.
Monthly.
You can make a phone or in-person appointment with your local small-business specialist to learn more about franchise financing or healthcare practice financing from Bank of America.

Bank of America SBA loans

Bank of America also offers multiple types of SBA loans, including standard SBA 7(a) loans, SBA Express loans and SBA 504 loans.
Bank of America is an SBA Preferred Lender, meaning the bank has extensive experience processing and servicing SBA loans. This designation also means that Bank of America can make final credit decisions without sending applications to the SBA, allowing for a faster loan approval timeline.

Bank of America SBA loan features

Loan amount
$25,000 to $5 million.
Estimated APR range
Varies based on your business’s qualifications, but subject to SBA maximums.
Fees
Guarantee, origination, packaging, processing and other miscellaneous fees may apply.
Repayment terms
Maximum of 25 years.
Repayment schedule
Monthly.

Where Bank of America stands out

Variety of loan options

Bank of America has a variety of business loans to choose from, including both unsecured and secured loans, as well as specialized financing options such as equipment loans, commercial real estate loans and business auto loans.
If you’re not sure which type of business loan is right for your needs, you can schedule an appointment with a Bank of America lending specialist to discuss your options.

Competitive rates and terms

Among its financing options, Bank of America offers business loans with long terms and competitive interest rates.
The unsecured Business Advantage Term Loan, for example, has terms ranging from 12 to 60 months, with fixed interest rates starting at 8% APR.
Similarly, Bank of America’s business auto loan has terms ranging from 48 to 72 months, with fixed interest rates as low as 7.09% APR — for borrowers who have excellent credit and meet other Bank of America requirements.

Discounts and rewards available

Bank of America offers discounts and perks to small businesses that are eligible for its Preferred Rewards for Business program. To join the program, you need:
  • An active Bank of America business checking account.
  • Three-month combined average daily balance of $20,000 or more in qualifying Bank of America business deposit accounts and/or Merrill business investment accounts.
There is no fee to join, and if you’re eligible, you can enroll through the Bank of America website.
Membership perks include discounted interest rates on business loans, no fees on select banking services and higher interest rates on savings accounts. Plus, there are three levels of reward tiers for the program — so, the more funds you hold in your qualifying Bank of America deposit accounts, the better discounts you can receive.

Where Bank of America falls short

Hard to qualify

Like other bank lenders, you’ll need to have strong financials and several years in business to qualify for funding from Bank of America. And while the bank’s Cash Secured Credit Line can help a business establish a credit history, it doesn’t actually provide additional funding since the security deposit must match the credit line amount.
Startups and businesses with bad credit will need to consider alternative sources of financing, such as online lenders or microlenders which typically have more flexible eligibility requirements.

Slow application process

You’ll typically need to schedule an appointment to meet with a Bank of America lending specialist, either by phone or in person, in order to submit an application. However, if you have a Bank of America Online Banking account, you can apply online for a Cash Secured Credit Line, or a Business Advantage Credit Line or Term Loan. You can also apply online for a Business Advantage Auto Loan.
Compared to lenders that allow you to create an online account to upload and submit documentation, Bank of America’s loan process will likely be much slower — resulting in a longer time to fund.

Limited information available online

Although not uncommon among bank lenders, Bank of America does not provide access to information that you may find from online lending competitors, such as interest rate ranges, credit score minimums and average time to fund. Knowing these details can save borrowers time and make it easier to compare loan offers.

How to apply for a business loan from Bank of America

If you have a Bank of America Online Banking account, you can complete an online application for unsecured business term loans and lines of credit, as well as the Cash Secured Credit Line.
You can also apply online for a business auto loan. For all other loans, or if you don’t have an online banking account, you’ll need to schedule an appointment by phone or in person with a business lending specialist.
When you complete a loan application, you’ll be asked to provide basic information about your business, including:
  • Business name, address and phone number.
  • Business tax identification number.
  • Nature of the business, date of establishment, number of employees.
  • Annual net profit and annual gross sales.
  • List of outstanding debt obligations (if applicable).
You’ll also need to provide information about each business owner, guarantor and controlling manager, such as:
  • Name, date of birth, residential address.
  • Social Security number (for U.S. citizens) or passport number and country of issuance (for foreign individuals).
  • Country of citizenship and country of residence.
  • Percentage of ownership.
  • Personal income.
  • Residential status (rent or own) and monthly housing payment.
If you’re applying for a commercial real estate loan, equipment loan or business auto loan, you’ll need to include details about the property, vehicle or equipment that you plan to finance.
Although you do not need a Bank of America business checking account to apply for a business loan, some loans require payments to be auto-debited from one of these accounts, meaning if you are approved, you’ll have to open one.

Alternatives to Bank of America business loans

Funding Circle

If you have strong credentials but don’t want to wait for a traditional bank loan, Funding Circle might be a good option for your business.
Funding Circle offers business term loans with competitive rates and terms, and a streamlined online application — with funding available in as little as two days. Funding Circle’s business loans are available in amounts up to $500,000, with terms from six months to seven years. Interest rates range from
15.22
% to
45
%.
To qualify, you’ll need a minimum credit score of
660
and at least
24
months in business. Read our full Funding Circle review.

American Express Business Line of Credit

American Express offers business lines of credit from $2,000 to $250,000, with terms of six, 12, 18 or 24 months. Instead of a traditional interest rate, American Express charges a fee each month that you have an outstanding balance — depending on your loan’s term.
Total monthly fees incurred over the loan term range are:
  • 3% to 9% for six-month loans.
  • 6% to 18% for 12-month loans.
  • 9% to 27% for 18-month loans.
  • 12% to 18% for 24-month loans.
If you have existing American Express credentials, you’re given the option to pre-fill your application for a streamlined process.
American Express Business Line of Credit can be a good option for newer businesses and those with less-than-perfect credit histories. To qualify, you’ll need to have started your business at least a year ago, and have a minimum FICO score of at least
660
at the time of application and an average monthly revenue of at least $3,000.
Note that the required FICO score may be higher based on your relationship with American Express, credit history, and other factors, and that all businesses are unique and subject to approval and review. Read our full American Express® Business Line of Credit review.

Compare your business loan options

The best business loan is generally the one with the lowest rates and most ideal terms. But other factors — like time to fund and your business’s qualifications — can help determine which option you should choose. NerdWallet recommends comparing small-business loans to find the right fit for your business.

Methodology

NerdWallet’s review process evaluates and rates small-business loan products from both traditional and online lenders. We collect over 30 data points on each lender using company websites and public documents. We may also go through a lender’s initial application flow and reach out to company representatives. NerdWallet writers and editors conduct a full fact check and update annually, but also make updates throughout the year as necessary.
Our star ratings formula takes into account features we consider to be small-business friendly, including: transparency of rates and terms, flexible payment options, fast funding times, accessible customer service, reporting of payments to business credit bureaus and responsible lending practices.
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.

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