What credit score do I need for a business loan?

It depends on the product and the lender. For term loans and lines of credit, floors in our marketplace run from 600 to 680: some lenders look at 600 to 640, usually at a higher cost, and at 640 you clear every floor except our primary lender's. Kapitus publishes 650 for those products, 660 for equipment financing, and 680 for SBA loans. In our experience, Kapitus approvals run 680 and above, and SBA approvals take a score above 700. Invoice factoring and purchase order financing look mainly at your customers' credit, not yours.

Can I get a business loan with less than 2 years in business?

It is harder. Most short-term lenders publish a 2-year minimum. With 1 year or more, equipment financing is possible through other lenders Kapitus works with. Newer businesses have better odds with invoice factoring, purchase order financing, SBA microloans, and community development lenders.

Do I need collateral for a business loan?

Not always. Many short-term loans are unsecured. Equipment financing uses the equipment as collateral, and factoring uses the invoices. In the Federal Reserve's 2025 survey, 51% of small businesses with debt had pledged business assets.

Will I have to sign a personal guarantee?

Probably. In the Federal Reserve's 2025 survey, 59% of small businesses with debt had used a personal guarantee. Ask before you sign whether one is required and what it covers.

Do I need a business plan to get a loan?

Usually not for short-term financing, which is decided on bank statements and credit. Larger loans and SBA loans can require a plan, tax returns, and financial statements.

Business Loan Requirements in 2026: What Lenders Check

The three numbers

Every lender starts with the same three questions.

How long have you been in business? Two years is the most common line. It shows the business has survived its riskiest stretch.
How much revenue do you bring in? Revenue sets the ceiling on what you can repay.
What is your credit score? For a small business, lenders weigh the owner’s personal credit heavily.

Clear all three and a lender will look at your file. That is all the minimums mean. They get you reviewed, not approved.

Requirements by product

The bar moves with the product. These are the minimums Kapitus publishes, plus the SBA’s own rules.

Product	Time in business	Annual revenue	Credit score	Also required
Term loan	2 years	$250,000	600 to 680 by lender. Kapitus publishes 650	Bank statements
Line of credit	2 years	$180,000	600 to 680 by lender. Kapitus publishes 650	Bank statements
Equipment financing	2 years published. 1 year with some lenders	Not published	660	Revenue-producing equipment from a licensed dealer
SBA loan	Varies by lender	Under $7.5 million average	680 published. Above 700 in practice	About 10% down, tax returns, financial statements
Invoice factoring	Not published	Not published	Your customers’ credit	Unpaid B2B or government invoices
Purchase order financing	Not published	Not published	No stated minimum	A confirmed order with at least a 10% margin
Business HELOC	Not a factor	Not a factor	600 behind a mortgage, 640 as a first lien	Equity in your home. The money must go to the business

Five things the published numbers miss:

A term offer can be a loan or revenue-based financing. The minimums are the same. How the two differ.
Credit floors are a ladder, not one number. Under 600, no fit today. From 600 to 640, some lenders will look, usually at a higher cost. At 640 you clear every floor except our primary lender’s. Kapitus publishes 650 and, in our experience, approves at 680 and above.
Equipment financing can start at 1 year. Kapitus publishes 2 years. Other lenders it works with will finance equipment for a business with 1 year or more.
SBA approvals run above 700. The published minimum is 680. In our experience, the files that get approved are above 700.
A Business HELOC skips the business numbers. It is underwritten on your credit and your home equity, not on time in business or revenue. Your home is the collateral, which is the whole trade.

Two patterns stand out:

Secured products are more forgiving of the owner. Factoring and purchase order financing look at your customers. Equipment financing looks at the equipment.
The cheapest money asks the most. SBA loans want the highest credit score and the most paperwork.

What underwriters read in your bank statements

The minimums are a screen. Your bank statements are the decision. Most short-term lenders ask for the last 3 to 6 months and read them for five things:

Average monthly deposits. Your real revenue, not the number on your tax return.
Number of deposits. Many deposits from many customers is safer than a few large ones.
Average daily balance. A healthy cushion shows you can absorb a payment.
Days with a negative balance. Overdrafts are the fastest way to shrink an offer.
Payments to other lenders. Existing daily or weekly payments reduce what you can carry.

If your statements are weak, wait. Two clean months change an underwriter’s read more than any explanation you can write.

Documents you will need

Almost always

3 to 6 months of business bank statements
A government-issued photo ID
Basic business details: legal name, tax ID, ownership

For larger loans

Business tax returns
A profit and loss statement and a balance sheet
A personal financial statement
A schedule of your existing debt

By product

Equipment financing: the dealer’s quote or invoice
Invoice factoring: an accounts receivable aging report and your articles of incorporation
Purchase order financing: the purchase order and your supplier’s quote
SBA loans: all of the above, and patience

Guarantees and collateral

Plan on being asked for a personal guarantee. The Federal Reserve’s 2025 survey of small employers found that among firms with debt:

59% had used a personal guarantee
51% had pledged business assets

A personal guarantee makes you personally liable if the business cannot pay. Read it. Ask whether it is limited or unlimited.

What the odds look like

From the same survey, covering the 12 months before fall 2025:

38% of small employers applied for a loan, a line of credit, or a merchant cash advance.
Of those who applied, 42% received everything they asked for.
36% received some or most of it.
22% received nothing.

Where you apply matters. Applicants at small banks were fully approved 57% of the time, the highest of any lender type.

Cost surprises matter too. 60% of online lender borrowers said their actual costs came in higher than they expected, against 37% at small banks. Whoever you borrow from, get the total payback and the APR in writing first. Our factor rate to APR calculator does the conversion.

If you fall short on one number

You are short on	Look at
Time in business	Equipment financing from 1 year, invoice factoring, purchase order financing, a Business HELOC if you own a home with equity, SBA microloans, community development lenders
Revenue	A line of credit, which starts at $180,000, factoring if your customers are strong, or a Business HELOC, which does not look at revenue
Credit score	Factoring and purchase order financing, which weigh your customers’ credit
Collateral	Unsecured short-term financing, or equipment financing where the equipment secures the loan

If you were already turned down, see what to do after a bank denial.

Five checks before you apply

Pull your own credit. Know your score before a lender tells you.
Read your last three statements like an underwriter. Count the overdrafts.
List every payment you already make to a lender.
Decide what the money is for and what it will earn.
Know your number. Our funding estimator gives a high-end figure in three questions.

Sources

Federal Reserve Banks: 2026 Report on Employer Firms, findings from the 2025 Small Business Credit Survey, published March 3, 2026. The survey uses a convenience sample of 6,525 employer firms.
Kapitus product pages for business loans, lines of credit, equipment financing, SBA loans, invoice factoring, and purchase order financing, checked October 2026