How to Get a Business Loan with Bad Credit

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Real Options for Business Owners Who Need Capital Now

If your credit score isn’t perfect—or even close—you might be worried that no one will give you a business loan. But here’s the truth: you can still get business funding, even with bad credit.

In fact, many lenders today offer funding options that don’t rely entirely on your credit score. The key is knowing where to look, what to expect, and how to prepare.

This guide will walk you through how to get a business loan with bad credit, the types of funding that might work for you, and how to improve your chances of approval.

What Counts as “Bad Credit”?

In the business funding world, “bad credit” usually means a personal credit score below 620. If you’re under 580, it’s considered poor—but not impossible.

Many business owners have credit challenges due to medical bills, divorce, past debt, or inconsistent income early on. Lenders understand that. Some will still work with you—especially if your business is earning steady revenue.

Can You Really Get a Loan with Bad Credit?

Yes—but it may not look like a traditional bank loan.

Most banks rely heavily on your personal credit score and may deny applications automatically if your score is too low. But alternative lenders, online platforms, and funding specialists often consider other factors—like your monthly revenue, time in business, or cash flow.

In many cases, these lenders offer:

  • Short-term loans

  • Merchant cash advances

  • Revenue-based funding

  • Equipment financing

  • Credit card stacking

  • Invoice factoring (if you invoice clients)

What Lenders Look For Instead of Credit

If your credit score is low, lenders may focus more on:

  • Time in business – 6+ months is ideal

  • Monthly revenue – often $5,000/month minimum

  • Bank statements – showing steady deposits

  • Business type and industry – low-risk industries tend to have more options

  • Assets or equipment – that can serve as collateral in some cases

📌 Tip: Having a clear plan for how you’ll use the funds can also help show lenders you’re prepared.

Best Funding Options for Bad Credit

Here are a few options worth exploring if your credit score is below 620:

Merchant Cash Advance (MCA)

Get a lump sum in exchange for a portion of future sales. Fast, but often higher cost.

Credit Card Stacking

Access multiple 0% interest business credit cards through strategic applications. Personal credit still matters, but you don’t need perfect credit.

Equipment Financing

If you’re buying business equipment, the equipment itself often serves as collateral.

Revenue-Based Loans

Repay based on a percentage of your revenue. Your income matters more than your score.

How to Improve Your Chances (Even Short-Term)

If you’re applying now but still worried about your credit, here are a few quick tips:

  • Keep your business bank account in good standing (no overdrafts!)

  • Show 3–6 months of steady deposits

  • Reduce existing credit card balances

  • Have your documentation ready (bank statements, business plan, etc.)

  • Work with a funding advisor who knows how to position your application

Need help? Download our Credit Repair Guide inside the Ultimate Business Funding Guide to start improving today.

✅ Ready to Explore Your Options?

Getting a business loan with bad credit is possible—you just need the right guidance and lender match.

Download our Ultimate Business Funding Guide to learn more about your options and how to prepare. Or Get Pre-qualified (below) to be matched with funding sources that work with business owners like you.

Get Pre-qualified Today!