Best Unsecured Business Loans for Small Business in 2018

This article reviews the best unsecured business loans for small businesses who cannot or don’t want to put their high value collateral on the line. We look at unsecured business loans that don’t require a personal guarantee and also those that do. We also review self-securing business loans as a great alternative.

Street Shares: Best Overall Unsecured Business Loan

If you’re looking for the lowest APR, StreetShares is the best option we could find with rates starting from 9% and topping out at 40%. The loan is not secured against your business and you’re no personal guarantee is required.

Visit Street Shares

Best Unsecured Business Loans with No Personal Guarantee

 Loan ($)TermAPR* 
street-shares-logo-one-of-the-best-small-business-loans-options$5-100K3-36 months9-40%Visit Site
fundbox-logo-one-of-the-best-small-business-loans-options$1-100K1-3 months15-59%Visit Site
kabbage-logo-one-of-the-best-small-business-loans-options$2-250K6-12 months24-99%Visit Site
* The APR will depend on how each online lender perceives the risk involved.

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Street Shares Line of Credit

StreetShares has the lowest APR with rates starting from 9%. However, you need a personal credit score of 600+ and to have been in business for over a year.  In addition, the maximum loan you can get is for 20% of your annual sales revenue.

Visit Street Shares

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Fundbox Short Line of Credit

If you’re looking for short-term working capital, Fundbox offers an unsecured cash advance. This is a line of credit with no personal guarantee required for up to $100k for up to 3-months. This often works well for very early stage businesses, because you do not need a minimum credit score, just a minimum of $25k in sales revenue and six months in business to qualify.

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Kabbage Short Term Loan

If you don’t have a credit score of 600+, Kabbage is a great option for bad credit who don’t require a minimum credit score. Like Street Shares, the loan is unsecured and they don’t require a personal guarantee. If your credit score is 550+ and you’ve been trading for more than a year, this is the best option we could find for a  6-12 month loan.

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Best Unsecured Business Loans with a Personal Guarantee Required

 Loan ($)TermAPR* 
lending-club-logo-one-of-the-best-unsecured-loans-for-small-business-providers$5-300K12-60 months9-36%Visit Site
ondeck-logo-one-of-the-best-small-business-loans-options$1-100K1-6 months14-40%Visit Site
bluevine-logo-one-of-the-best-small-business-line-of-credit-providers$6-200K6 or 12 months15-78%Visit Site
* The APR will depend on how each online lender perceives the risk involved.

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Lending Club Term Loans

Term loans for anything up to 5-years for $300k are available at competitive rates starting from 9.8%. This marks Lending Club out as one of the most competitive unsecured loan options available online. To qualify, you need a 600+ personal credit score, a year in business and $50k+ in annual sales revenue. A personal guarantee is required for loans under $10ok. Larger loans, require a lien on your liquid business assets, like cash-in-hand and inventory.

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OnDeck Unsecured Line of Credit

If you need working capital to manage a short-term cash flow crisis, OnDeck provide a competitive solution with rates ranging from 14-40%. OnDeck’s line of credit doesn’t require a lien over your business’s collateral, but you will have to provide a personal guarantee. To qualify, you need a 600+ personal credit score to qualify, at least one year of trading and $10ok+ in annual revenue.

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bluevine-logo-one-of-the-best-small-business-line-of-credit-providers

BlueVine Line of Credit

With an unsecured line of credit starting from a rate of 16% with a top rate of 78%, BlueVine are not the most competitive option we reviewed . However, with a personal credit score of 600+ you can usually qualify for a 6 month loan within 36-hours. For a 12-month loan you’ll need a personal credit score of 650+. In addition you’ll also have to you’ll need to show $500k+ in annual sales revenue and two years of trading to be considered.

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Best Self-Securing Business Loans

A great alternative to an unsecured business loan, is a self-securing business loan. This means that the loan is secured against what you are financing. For instance, if you fail to repay your equipment loan, the equipment being funding acts as the collateral and can be taken by the lender to repay the outstanding loan.

We recommend that for most circumstances, it would be better to explore self-funding options before considering unsecured loans that require a personal guarantee. Below, we have provided three of the best in class self-financing loans for invoice, equipment and Government contract funding.

 Loan ($)TermAPR* 
Fundbox$1-100K12 months
24 months
16-68%
19-77%
Visit Site
Currency$5K-2MM12-60 months6-24%Visit Site
Street Shares$1-500K3-36 months12-25%.Visit Site
* The APR will depend on how each online lender perceives the risk involved.

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Fundbox Invoice Financing

If you have outstanding customer invoices, Fundbox offers invoice financing, (also known as invoice factoring). This is an unsecured loan with no collateral or personal guarantee required. Instead the loan is secured against outstanding invoices. However, you must use one of the major online accounting systems like QuickBooks or Xero. This allows Fundbox to integrate with your accounts to provide the service.

After you receive your cash advance, you can repay in either 12 or 24 weekly instalments. And should your customer pay you sooner, you can repay the loan in full to save on costs, with no penalty for early settlement.

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Currency Equipment Financing

With its main focus on equipment loans, Currency can offer up to $2 million with loan rates ranging from 6 to 24%. As a specialist, Currency work with you to ensure the payments are spread over the useful lifetime of your equipment. To qualify, you need a personal credit score of  585+, six months in business and $75k of annual sales revenue.

One of the things we like about Currency, is that its a marketplace, matching the right lenders with the right customers. This should help you to get better terms for your equipment financing.

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Street Shares Government Contract Financing

This is an innovative new type of loan for small businesses who work on government contracts. The APR ranges from 12 to 25% and StreetShares loan you 80 to 90% of the contract value once it has been signed. Once you’ve been paid, Street Shares pay over the balance outstanding less their fees. Like with invoice, financing, there is no penalty fee for paying the loan back early.

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When to Consider Unsecured Business Loans

If you qualify for a bank loan this should be your first stop as in most cases it will cost less.

However, carefully review whether you have to provide a personal guarantee if you are thinking about getting a business loan. You maybe surprised to learn that many small business owners fail to recognize that they are personally liable for an unsecured business loan. A personal guarantee allows the lender to take assets you own to recover any outstanding loan repayments.

As a result, we would recommend pursuing a self-securing loan or an unsecured business loan that does not require a personal guarantee. As the last resort, we would look to unsecured business loans that do require a personal guarantee. Before you sign a loan requiring a personal guarantee, consider carefully what could cause you to default on the loan and whether this is a risk worth taking.

The Juice Press

This article reviewed the best unsecured business loans for small business. We provided a range of online lender options to meet most needs. We recommend choosing an unsecured loan that does not require a personal guarantee. If you have a personal credit score of 600+ we recommend Street Shares who have the lowest rates, which start from 9%.

Visit Street Shares