Before you choose restaurant business loans, always consider whether they meet the specific goals of your business. There are different options based on the different needs of restaurant owners. Hence, to learn more, read on through to the end of the article.
What Are The Best Restaurant Business Loans (2024 Updated)
According to Investopedia,
“Restaurant business loans provide working capital to buy equipment, hire employees, or pay your bills during a slow time. Plenty of funding options exist, from direct to alternative lenders. However, your interest rates and term length will vary by loan type, credit score, and revenue. Selecting an online lender can get funds into your account within days, whereas traditional bank lenders may take weeks.”
To get to know the best loan options, read the subsections below.
The Best Restaurant Business Loans: Top Five
The following are some of the best business loans you can check out for your restaurant business:
1. Fora Financial
This is one of the best overall restaurant business loans. This is because the lender offers you restriction-free funds to you. Apart from that, you can also get approval within 24 hours.
|One of the fastest financing options
No requirement for a minimum credit score
You can avail of early payment discounts
|There can be high loan fees and interest rates
If you chose the revenue advance option,
You might have to pay daily or weekly
If your restaurant business is facing a slowdown, then you must choose Fundbox. Here, Fundbox offers you a flexible line of credit. Basically, you can access this credit whenever you need it, and you must only pay for what you use.
|The minimum credit score is low at 600
There is no penalty if you pay off early
You will also not have to pay origination fees
|You can get funds only up to $150,000
Requires business lien
If your restaurant needs quick cash, then OnDeck is the best option, as it offers short-term loans. The loans range from $5,000 to $250,000. You can apply the funds for various expenses as well.
|A great option to build your business credit
You can also get funding on the same day
|You have to apply a personal guarantee
Only businesses with annual gross revenue of $100,000 can qualify
Some states like Nevada, North Dakota, and South Dakota are not eligible
4. SBA 7(a) Loan
If you want big finance, SBA loans are some of the best ones. Here, the SBA 7(a) loan can offer you financing up to $5 million. If you have large expenses like buying real estate for the restaurant or new equipment, this is the best option you can choose.
|There is a maximum limit on the rate of interest
The repayment terms are lengthy
|If you choose a loan over $25,000, you have to keep the collateral
The funding time is generally lengthy
If you are getting an SBA loan, the majority of funds have SmartBiz. Basically, 90% of SmartBiz’s referrals get qualified.
|As compared to a conventional SBA loan, you will get quicker funding
As compared to other lenders, you will get competitive rates
When you apply for a loan, you will get helpful customer support
|You need to be at least three years in your business
The government requirements are very strict
You have to provide a personal guarantee and business lien
Some Other Restaurant Business Loans You Can Check Out
Here are some more restaurant business loans you can consider:
1. Funding Circle
A restaurant with a good credit score can avail of a lot of options from Funding Circle. Here, you have the option to choose from different loan options. Apart from that, you can also get good customer service.
|In most cases, interest rates are fixed with fixed monthly payments
A great option to build your business credit
|You need a solid credit score
The business must be at least two years old
It requires a personal guarantee
You have to keep a lien on your business assetsLack of transparency on interest rates
Not available in the state of Nevada
This one is a great option, even if you have a poor or below-average credit score. However, you can get an approved loan with Credibly. Furthermore, you will also get funding on the same day.
|You only need a credit score of 500 to qualify for the loan
There are a range of loan options to choose from
There are no hidden fees in the loan
|If you have poor credit, there are factors like high interest rates, etc.
In some cases, loans require daily or weekly payments
If you need an extra infusion of cash for your restaurant business, then Bluevine is one of the best options to choose. Basically, it offers a line of credit that can be up to $250,000. You can apply the funds for a variety of things.
|Funding is quick
You only pay for the part that you use from the funds
|The business needs to have a higher credit score (625 or above)It must be in business for at least two years
There can be a weekly repayment schedule
To qualify, your business needs to have a monthly revenue of at least $40,000
4. Crest Capital
With the help of Crest Capital, you will have the freedom to deal with your expenses. Also, there are no hidden costs on the loan. Furthermore, if your equipment financing is less than $250,000, you will get a 4-hour turnaround time. Hence, such factors make this loan one of the best ones.
|There are many options for loans and lease
You will get 1005 equipment financing as well as loans for soft expenses
Approvals and funding are fast
|You need to have good credit if you want to qualify
Not suitable for startups
A lot of paperwork for loans over $250,000
Hope this article was helpful for you in getting an idea of the best restaurant business loans. However, before you choose a loan option, evaluate whether the lender suits your needs and demands or not. Also, go through the pros and cons of the loan options before you make your decision. Do you have more information to add on the loan options? Consider sharing them with us in the comments section below.