5 Things You Need to Know About Fast Business Loans

Fast business loans are a great way to get quick access to financing when you need it the most – for example, during off-peak seasons or slow seasonal cycles, times in which you need to increase inventory to meet unexpected demand and other situations.

However, when you are in a hurry to get a business loan, it’s easy to overlook details that could lead to a longer application and approval process than necessary. For this reason, it’s important to get a good understanding of what fast business loans are and how they work.

Before you start looking for business lenders and sending in applications, here are some of the most important things you will need to know before applying for a fast business loan:

Fast Business Loans: 5 Things to Know Before Applying

1. Fast is a relative and arbitrary term

Before you get too excited about fast business loans, keep in mind that they are not always as literal as they seem. Virtually all lenders advertise “fast business loans” (or make a similar claim) on their websites.

Unfortunately, speed in this context is not a regulated standard or even governed by industry best practices — it is totally arbitrary.

For example, some so-called fast business loans offered by banks can take several months before you get an approval decision, and there are several SBA loan types where applications snake their way through dozens of loan officers for up to a year.

Therefore, when you’re looking for a fast business loan, make sure there is a specified time when you can expect to receive an approval.

Some lenders, like National Business Capital, offer fast business loans and back it up by saying you will have an approval decision within 24 hours. This way, lenders are showing you how fast their loans can be instead of just calling them “fast” without an actual backup.

Here’s how fast you can expect to get funding from us depending on the loan type:

• Small business loans – 24 hours
• Business line of credit – 24 to 48 hours
• Equipment financing – 24 to 48 hours
• Hybridge SBA loan – 24 to 48 hours
• Revenue-based financing – 24 to 48 hours

The bottom line is, if you need a business loan immediately, you are highly unlikely to get it with traditional lenders such as banks and credit unions – they can take anywhere from 60 to 90 days to process your application.

However, with alternative lenders like National Business Capital, you can have the money available in your account within 24 hours after you’ve been approved for the loan.

2. Fast doesn’t always mean approved

Another thing to keep in mind when applying for fast business loans is that fast doesn’t necessarily mean approved.

Some lenders have an “express” loan program that reduces the typical application assessment time from months to days. However, what most of these lenders do not advertise, is their approval rates.

This is often because “express lenders” have approval rates well below 50%, with some as low as 10-20%, which is similar to the approval rates of a traditional bank.

Advertising a “fast loan” may get a higher volume of customers for these lenders so they can be selective and only approve perfect candidates for financing. So before you submit your loan application for a fast loan, browse your potential lender’s website for an approval rate and see how high it is.

A high approval rate means that a lender is able to work with more businesses even if they have bad credit, a previous bankruptcy, etc. This helps you determine whether the lender is truly trying to help businesses get funding (high approval rating) or whether they are picking out perfect customers to finance (low approval rating).

For example, at National Business Capital, we approve around 90% of applications because we can help any business in almost any situation. Our approval decisions on fast business loans are not solely based on having bad credit, tax liens, or foreclosures.

We understand that can happen to anyone and shouldn’t stop your business from achieving its goals.

3. Fast should not mean that strings are attached

When it comes to fast business loans, another thing you will need to keep in mind is that this type of financing doesn’t mean that there will be strings attached.

Some lenders — venture capitalists come to mind — legitimately offer fast business loans, but there is a big catch: they want to dictate (to some degree) how and when the funds are used.

Any deviations, delays or disruptions from the plan will breach the agreement and could result in the loan being immediately called in.

Because you know your business best, make sure you find out what your loan can be used for before applying. At National Business Capital, we believe that our customers — and not us — are in the best position to make smart and safe decisions.

That is why we do not impose any conditions, restrictions, or limitations on how loan funds are allocated.

4. Fast business loans offer flexibility

Just because you are applying for a fast business loan doesn’t mean that there is no flexibility – in fact, this type of financing can be flexible in a lot of different ways, such as the loan amount that you are trying to get.

Loan amounts can vary widely, from a few thousand to hundreds of thousands of dollars, based on your business needs and creditworthiness. With National Business Capital, you can get up to $10 million in funding amounts.

As we mentioned earlier, depending on the lender, you may also not face a lot of restrictions regarding the use of the funds – you can use them for operational costs, emergency expenses, or growth initiatives.

5. Fast business loans are often unsecured

Another thing to keep in mind before applying for fast business loans is that they are often unsecured, which means that you won’t have to provide collateral as an extra layer of security against default.

For you as a borrower, this means reduced risk as there is no threat of losing a vital asset like property or equipment if the loan can’t be repaid. It also means that you can still access financing even if you don’t have significant physical assets.

However, this also means that you may have to show a higher credit score – ideally, above 680, as well as more stable business revenue in order to secure better terms.

Another thing to consider is potentially higher interest rates – because these loans do not have collateral to mitigate the lender’s risk, they often come with higher interest rates compared to secured loans – which you can opt for as well.

Learn More About Fast Business Loans

To learn more about applying for — and getting — a fast business loan from National Business Capital, contact us today by phone, email, or launch a web chat right now (see the bottom-left of your screen).

We will provide you with an informative, no obligation consultation that includes an overview of our secured and unsecured business financing solutions. We are available 24/7/365. Start by filling out our 1-minute application, and we’ll help you find a loan option that’s right for your business.