The best personal loan for business should provide flexible qualification requirements, low rates and fees, and quick access to funds. For businesses ineligible for traditional business financing, this alternative route may be easier to qualify for. However, while getting those approvals can be easier, they may come at the cost of higher rates.
Here are our top picks for the seven best personal business loans:
- Upstart: Best overall for flexible qualification requirements
- LightStream: Best for borrowers with excellent credit
- Discover: Best for low monthly payments
- Upgrade: Best for borrowers with low credit scores
- SoFi: Best for larger loan amounts
- Rocket Loans: Best for quick access to funds
- LendingClub: Best for debt consolidation
Best Personal Loans at a Glance
Estimated Starting APR | Maximum Repayment Term | Maximum Loan Amount | Minimum Credit Score | Application to Funding Speed | |
|---|---|---|---|---|---|
 | 7.8% | 5 years | $50,000 | None | 1 business day |
 | 6.99% | 10 years | $100,000 | 680 | Same-day |
 | 7.99% | 7 years | $40,000 | 660 | 24 hours |
 | 9.99% | 7 years | $50,000 | 580 | 1 business day |
 | 8.99% | 7 years | $100,000 | 650 | Same-day |
 | 8.99% | 5 years | $45,000 | 640 | Same-day |
 | 8.98% | 5 years | $40,000 | Undisclosed | 1 to 7 days |
Upstart: Best Overall for Flexible Qualification Requirements
| |
Rates & Terms | |
Estimated APR | 7.8% to 35.99% |
Loan Amount | $1,000 to $50,000 |
Repayment Term | 3 or 5 years |
Repayment Schedule | Monthly |
Origination Fee | 0% to 12% |
Prepayment Penalty | None |
Allowable Uses | No stated restrictions |
Funding Speed | As fast as one business day |
Qualifications | |
Credit Score | None |
Minimum Income |
|
Why We Like Upstart
Upstart is our pick as the best overall provider for its competitive rates and flexible qualification requirements. Compared to other lenders on our list, it has some of the lowest starting rates and is the only provider in our guide without a minimum credit score requirement.
While it can work with almost any credit score, it does look at certain aspects of your credit history in evaluating your application. You must not have any current delinquent accounts and public records or bankruptcies within the past 12 months. You must also have fewer than six hard inquiries on your credit report, although inquiries related to student loans, auto loans, and mortgages can be excluded.
With Upstart, you can check your rate online in under five minutes with no impact on your credit score. It can also offer fast funding, as it states that 99% of personal loan funds are disbursed within one business day of signing your loan agreement.
LightStream: Best for Borrowers with Excellent Credit
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Rates & Terms | |
Estimated APR | 6.99% to 25.49% |
Loan Amount | $5,000 to $100,000 |
Repayment Term | 2 to 10 years |
Repayment Schedule | Monthly |
Origination Fee | None |
Prepayment Penalty | None |
Allowable Uses | Loans must not be used for educational purposes |
Funding Speed | As fast as the same day |
Qualifications | |
Credit Score | Varies, but 680 minimum is recommended |
Minimum Income | Varies |
Why We Like LightStream
To get approved with LightStream, you’ll need to have good to excellent credit. While not a set requirement, it’s recommended that you have a score of 680 or above, which is the highest in our guide. However, borrowers who qualify can get competitive rates, loan terms, and fast funding speeds. For this reason, it makes our list as the best option for borrowers with excellent credit. Also, the lender offers the lowest starting estimated APR on our list, in which borrowers with strong credit are most likely to qualify for.
With that being said, LightStream considers more than just your credit score. It will also review things like how long you’ve had credit, available assets, and how much debt you carry. Having strengths in multiple areas can help offset a lower score and improve your chances of getting approved.
LightStream’s personal loans carry no fees. There are no origination fees and prepayment penalties, so you can save interest by paying off the loan early. The provider also has a virtually paperless application process that it says can be done from even a smartphone or tablet.
To get the lowest advertised rate, you’ll need excellent credit and have to sign up for automatic payments. Applications can be completed on the LightStream website, with funds that can be made available as soon as the same day that you apply.
Discover: Best for Low Monthly Payments
| |
Rates & Terms | |
Estimated APR | 7.99% to 24.99% |
Loan Amount | Up to $40,000 |
Repayment Term | 3 to 7 years |
Repayment Schedule | Monthly |
Origination Fee | None |
Prepayment Penalty | None |
Allowable Uses | No stated restrictions |
Funding Speed | As fast as the next business day |
Qualifications | |
Credit Score | Undisclosed, but 660 minimum is recommended |
Minimum Income | $25,000 annually |
Why We Like Discover
Discover makes our list as a provider that offers long repayment terms and some of the lowest rates in this guide. This combination allows for low monthly payments for borrowers with a tight budget. It’s important to note, however, that meeting the minimum criteria does not guarantee approval, and this provider’s lowest rates will require you to exceed the minimum requirements. If your DTI is high or you have a lower credit score, you could be subject to higher rates.
A standout feature of Discover is the fact that it offers a 30-day guarantee. If you decide you no longer need the loan within that time frame, you can return the funds you received, and the provider will cancel the loan with no interest charges. For consolidation purposes, it also offers direct payments to creditors instead of having funds deposited into your account.
To apply, you can visit the Discover website or speak to one of Discover’s loan specialists. If approved, you can receive funds as soon as the next business day.
Upgrade: Best for Borrowers With Low Credit Scores
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Rates & Terms | |
Estimated APR | 9.99% to 35.99% |
Loan Amount | $1,000 to $50,000 |
Repayment Term | 2 to 7 years |
Repayment Schedule | Monthly |
Origination Fee | 1.85% to 9.99% |
Prepayment Penalty | None |
Allowable Uses | No stated restrictions |
Funding Speed | As fast as the next business day |
Qualifications | |
Credit Score | Varies, but 580 is recommended |
Minimum Income | Varies |
Why We Like Upgrade
Upgrade makes our list as the best option for borrowers with low credit scores, since it has the lowest recommended score of our guide. For borrowers with limited resources or credit history, it’s an accessible provider that offers a variety of flexible financing options.
A feature we like about Upgrade’s personal loans is its rate discount opportunities. Such opportunities include up to 0.5% for automatic payment setup (the highest on our list in comparison to SoFi and Rocket Loans) and additional percentage discounts for direct payments to creditors on consolidation loans. You may be eligible for further discounts if you utilize multiple products offered by Upgrade, such as checking accounts and cards. These discounts can be particularly useful since Upgrade has the highest starting rate of this guide, likely to offset its low credit score requirements.
To learn more, you can visit Upgrade’s website to find out if you pre-qualify and preview financing options with no impact on your credit score. It offers a simple and quick application, with a fast decisioning and disbursement process.
SoFi: Best for Larger Loan Amounts
 | |
Rates & Terms | |
Estimated APR | 8.99% to 29.49% |
Loan Amount | $5,000 to $100,000 |
Repayment Term | 2 to 7 years |
Repayment Schedule | Monthly |
Origination Fee | 0% to 7% |
Prepayment Penalty | None |
Allowable Uses | No stated restrictions |
Funding Speed | As fast as the same day |
Qualifications | |
Credit Score | Varies, but 650 minimum is recommended |
Minimum Income | Varies, but $45,000 annually is recommended |
Why We Like SoFi
SoFi offers the largest amount of financing of the lenders listed in this guide, making it a good option if you need a large loan amount with flexible credit requirements. Notably, there are optional origination fees and no prepayment penalty associated with its personal loan offerings.
Similar to Upgrade, it also offers rate reductions of 0.25% for members who sign up for automatic payments. In comparison to other providers in this guide, qualification requirements can vary but are generally flexible and inclusive of a variety of borrowers with good credit. If you’re having difficulty qualifying on your own, SoFi also accepts co-signers who live with you.
To see what rate you can get, visit the SoFi website. You can view rates and loan options in under one minute to find out if you pre-qualify, with no impact on your credit score and no obligation to accept a loan offer.
Rocket Loans: Best for Quick Access to Funds
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Rates & Terms | |
Estimated APR | 8.99% to 29.99% |
Loan Amount | $2,000 to $45,000 |
Repayment Term | 3 or 5 years |
Repayment Schedule | Monthly |
Origination Fee | Up to 9% |
Prepayment Penalty | None |
Allowable Uses | No stated restrictions |
Funding Speed | As fast as same day |
Qualifications | |
Credit Score | 640, but can vary |
Minimum Income | Varies |
Why We Like Rocket Loans
If you need funds fast, Rocket Loans can offer same-day funding. While other lenders in our guide such as SoFi and LightStream also offer fast funding speeds, Rocket Loans has the lowest credit score requirement, making it our pick as the best provider for borrowers seeking quick access to funds.
In general, the minimum income you’ll need is dependent on how much debt you’re carrying, as Rocket Loans considers your DTI as a key factor in whether you will get approved. Like SoFi, Rocket Loans offers a 0.30% rate discount if you set up automatic loan payments. However, it’s worth noting that this provider doesn’t offer direct payments to creditors or secured or co-signed loans like other lenders listed here, such as LendingClub and Discover.
To learn more, you can visit the Rocket Loans website, where you can also get prequalified in under one minute. Prequalifying with this provider allows you to see your available loan options without impacting your credit score.
LendingClub: Best for Debt Consolidation
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Rates & Terms | |
Estimated APR | 8.98% to 35.99% |
Loan Amount | $1,000 to $40,000 |
Repayment Term | 2 to 5 years |
Repayment Schedule | Monthly |
Origination Fee | 3% to 8% |
Prepayment Penalty | None |
Allowable Uses | Loans must not be used for education, investing, or illegal activity |
Funding Speed | Typically 1 to 7 days |
Qualifications | |
Credit Score | Undisclosed |
Minimum Income | Varies |
Why We Like LendingClub
LendingClub is a peer-to-peer lender, meaning its loans are funded by investors. It’s our pick for borrowers looking to consolidate debt, as it offers a potential rate discount and balance transfer services. It will issue funds to creditors and work closely with you to help simplify the consolidation process.
One downside is that the provider’s funding speed is not as quick as other lenders listed here. In some cases, funding can take up to seven days. It also does not publicly share the minimum credit score requirement, so you may not know what you can qualify for until after you apply. However, it has consistently received positive reviews from customers, so it’s still an excellent option worth considering.
You can submit an application from the LendingClub website in a matter of minutes. You can then choose a loan offer depending on the combination of rates and payment options you prefer. If additional documents are needed for verification, you’ll be notified. Otherwise, funds can be sent directly to you or your creditors if you are approved.
How We Chose the Best Personal Loans for Business Funding
Providers for the best personal loan for business funding were selected using the following criteria:
- Interest rates and estimated APR
- Available loan amount and repayment terms
- Loan fees such as prepayment penalties and late fees
- Qualification requirements such as credit score, income, and DTI
- Ease of application process
- Documentation required
- Approval and funding speed
- Customer reviews and ratings
How to Choose a Personal Loan Provider
When getting a personal loan to start a business, you should weigh all your options when choosing a lender and consider several factors before you make a decision.
- Determine your eligibility: Take your credit score, credit history, job history, your annual income, and DTI ratio into account. These eligibility requirements will vary per lender, however you should aim to meet the minimum requirements before applying for better odds of approval.
- Consider your intended use of funds: Most personal loans have little or no restrictions as to how you can utilize loan proceeds. You should ensure that your intended use of funds is within the maximum loan amount offered and that it can cover your business needs.
- Factor in your budget: You should only borrow what you can afford, and this is especially important if you don’t currently have the resources or qualify for other forms of financing.
- Compare rates, fees, and terms: Lastly, you’ll want to compare various loan offerings when shopping around for a lender. Rates, fees, and terms can vary heavily depending on the provider, so be sure to work with one that meets your needs before applying.
Alternatives to Personal Loans
As with any form of financing, there are both advantages and risks to using a personal loan to fund your business. To learn more about whether it’s the right fit for you, you can read our business vs personal loan comparison.
If you determine it’s not the right choice for your business needs or you simply don’t qualify, you can consider the following alternatives:
- Small business line of credit: This is a revolving credit facility that allows you to request a draw on the line on an as-needed basis and have the funds deposited to your account of choice. The line can be repaid over time and can be used for virtually any business expense. Check out our picks for the best small business lines of credit.
- Business credit card: Similar to a line of credit, a business credit card can be used to make as-needed business purchases in which the balance can be repaid over time. Generally, it comes with little to no purchase restrictions and is a good option to have in the event of emergencies or unplanned expenses. Our list of the leading small business credit cards may help you find a card that works for you.
- Startup business loan: Getting a business loan as a new company can be difficult because of the high failure rate of startups. However, several other types of loans can offer funding to newer businesses. Check out our guide to startup business loans, which covers the best ways to fund your startup.
- Friends & family loan: You may be able to borrow funds from friends and family members to support your business. This is a less formal way to obtain financing, and often offers favorable rates and terms in comparison to traditional loans. That said, there are still applicable regulations you’ll need to follow. Read our guide on raising money from friends and family to fund your business to learn the details.
- Crowdfunding: Instead of taking on debt, you can use a crowdfunding platform to raise funds for your business. There are various forms of crowdfunding, including equity based, debt based, rewards based, and donations based. To learn more about the process and how to market a crowdfunding campaign, read our article on how to crowdfund a business.
Frequently Asked Questions (FAQs)
Yes. In fact, most personal loans have few restrictions on how you may use the funds. Out of the providers we’ve selected in our guide, the most restrictive uses typically prohibit funds from being used for illegal activity or to cover educational expenses.
It depends on your financing goals and qualifications. Personal loans rely more heavily on your personal qualifications rather than that of your business, so they can be easier to get. However, business loans tend to have more flexible loan terms such as rates, repayment terms, and loan amounts.
Depending on the lender and your intended use of funds, personal loans can be more expensive than business loans. However, it can vary on a case-by-case basis. We recommend shopping rates with multiple lenders and considering different types of loans to find the most cost-effective solution for your needs.
Bottom Line
The best personal business loans should provide flexible qualification requirements, low interest rates, and favorable loan terms. These loans are best suited for borrowers who are in need of business funding and may not qualify for a traditional business loan, but have strong personal finances and credit history that allows them to qualify for a personal loan.
Keep in mind, there are various pros and cons when using a personal loan to fund your business. So, if you choose this method of financing, be sure it’s worth the risk and applicable to your business needs.
