Apply for Loans with bad credit

A weak personal credit score indicates you’ve mismanaged your personal finances in the past. Bad credit (a score that ranges from 300 to 629) is one reason business loan applications get rejected — and the approval rate of business loans from big banks was just 22.9% as of December 2015, according to a Biz2Credit report. It’s already tough to get a traditional business loan — bad credit makes it that much tougher.

But it is still possible to get a business loan with bad credit. Below we have highlighted some of your best options, depending on your credit score, revenue and business needs.

If you have unpaid invoices and want to avoid a credit check: Fundbox

Fundbox is another good choice for invoice financing. Like BlueVine, it advances you cash based on invoices and emphasizes your clients’ ability to pay you rather than your credit score.

To qualify for Fundbox, you’ll need to use online accounting or bookkeeping software such as QuickBooks, Xero or Wave and have a minimum of six months’ activity in one of these software applications. The company does not require a minimum personal credit score or minimum annual revenue.

Bad-credit small-business loans: The bottom line

Bad personal credit is often an obstacle in getting business loans from a traditional bank. Alternative lenders provide options as they place more of an emphasis on the strength and operating history of your business, and worry less about your credit. As with any small-business loan, it’s important to carefully compare all of your options, weighing each loan’s terms and APR.

Find and compare the best small-business loans

If none of these works for you, or if you’d like to compare your loan options, NerdWallet has curated a list of small-business loans best for business owners. All of our recommendations are based on the lender’s market scope and track record and on business owners’ needs, as well as rates and other factors, so you can make the right financing decision.

Steve Nicastro is a staff writer at NerdWallet, a personal finance website. Email:

This post was originally published on Nov. 13, 2015

Image via iStock.

• Have you been in business for at least a year?
• Is your personal score 500 or higher?
  You or at least one business owner has to have a personal credit score of 500 or higher for term loans. For its line of credit, the lender requires a credit score of at least 600 from a majority owner. Nerd note: A vast majority of OnDeck borrowers in 2015 had a personal credit score of 600 or higher, according to the company.
• Does your business generate at least $100, 000 in annual revenue?
  OnDeck requires an annual revenue of $100, 000 or more for term loans, and $200, 000 or more for lines of credit.
• Do you have zero major credit blemishes?
  You can’t have had a personal bankruptcy in the last two years.

If you answered “no” to any of these questions, check out the other bad credit loan choices. Credit cards are another option for a revolving line of credit. Read about the pros and cons of business credit cards.

• Note: Kabbage does not have a minimum personal credit score requirement.
• Does your business generate at least $60, 000 in annual revenue?
• Do you have a business checking or PayPal account?

• Have you been in business for at least a year?
  The lender’s borrowers average more than five years in business, but after one year, you are in the running.
• Are you profitable?
• Do you have a personal credit score of 600 or higher?
  The typical Dealstruck borrower skews a little higher, with an average credit score of 660 to 700.
• Does your business generate at least $150, 000 in annual revenue?
  Keep in mind average yearly revenue for the lender’s borrowers is $1 million to $2 million. But with $150, 000, you are eligible.

• Do you have unpaid invoices?
• Do you have a personal credit score of at least 530?
• Does your business generate at least $70, 000 in annual revenue?
• Do you have zero major credit blemishes?
  BlueVine requires that you’ve had no personal bankruptcy in the last year.

• Note: Fundbox does not have a minimum personal credit score requirement.
• Do you have unpaid invoices?
• Do you use online accounting or bookkeeping software, such as QuickBooks, Xero, Harvest or Freshbooks?
• Do you have at least six months of activity in one of the software applications?
• Do you have zero major credit blemishes?
  Fundbox requires that you’ve had no personal bankruptcy in the last year.

Interesting facts

• The Quicken Loans 400 is a 400-mile (643.737 km) NASCAR Sprint Cup Series stock car race held annually at Michigan International Speedway in Brooklyn, Michigan, and it is the first of two Sprint Cup races at Michigan. In 2006, 3M signed a three-year agreement to sponsor the race, but after one year moved its sponsorship to the August race...