Rise Business Funding

Business Term Loans

A business term loan gives you a lump sum of capital upfront with a fixed repayment schedule: predictable payments, clear timeline, no surprises. Whether you need funding for 3 months or 10 years, term loans are the most straightforward form of business financing. Rise connects businesses with term loans from $5,000 to $5,000,000, with daily, weekly, or monthly payment options. From covering a short-term cash flow gap to funding a major expansion, term loans offer the structure and certainty that other products can't match.

Check Eligibility
Business owner reviewing loan terms and financial documents

What Is a Business Term Loan?

A business term loan is the most traditional form of commercial financing. You receive a fixed lump sum, agree to a repayment schedule (daily, weekly, or monthly), and pay back the principal plus interest over a set period, known as the "term." Once the loan is fully repaid, the obligation ends. There is no revolving balance and no ongoing commitment.

Term loans come in two varieties: short-term (3 to 18 months) and long-term (1 to 10+ years). Short-term business loans offer faster funding and easier qualification but higher total cost. Long-term business loans offer lower rates and larger amounts but stricter qualification and longer approval timelines.

The term loan structure makes financial planning straightforward. You know exactly what you owe, when it's due, and when the loan ends. This predictability makes term loans the preferred choice for businesses that want clear budgeting certainty. Use our business loan calculator to compare short vs long-term options.

Requirements to Qualify for a Business Term Loan

Personal FICO Score

600+ short term / 650+ long term

Qualification thresholds vary by term length. Short-term products are more accessible; long-term loans require stronger credit.

Monthly Revenue

$10,000+

Lenders verify your ability to handle the payment schedule. Stronger revenue qualifies for larger loan amounts and better rates.

Time in Business

6+ months short term / 2+ years long term

Short-term lenders accept newer businesses. Long-term lenders need a longer track record to justify the extended commitment.

Bank Account

Business account required

Used to verify revenue patterns and manage automated repayments. Personal accounts are not accepted.

Not sure which term length is right? Rise evaluates your needs and matches you with the best option. Businesses across all industries are welcome, including manufacturing companies investing in capacity and restaurants funding renovations.

How Business Term Loans Work

Receive a Lump Sum

The full loan amount is deposited into your business bank account upfront. Amounts range from $5,000 to $5,000,000 depending on your revenue, credit, and the loan term.

Fixed Repayment Schedule

Payments are automatic and predictable, deducted daily, weekly, or monthly from your bank account. The amount is fixed from day one. No variable rates, no compounding unknowns.

Choose Your Term Length

Short-term (3 to 18 months) for immediate needs with faster approval. Long-term (1 to 10 years) for major investments with lower monthly payments. The right term aligns the repayment timeline with the purpose of the capital.

Loan Ends When Repaid

Once the total repayment amount is reached, the loan is complete. No revolving balance, no ongoing obligations, no annual fees. The relationship is defined and finite.

See If You Qualify for a Business Term Loan

Checking your eligibility won't impact your credit score.

Check EligibilityPre-Qualify Now

Pros & Cons of Business Term Loans

Pros

Predictable Fixed Payments

Know exactly what you owe and when. Budget with certainty, with no variable rates and no fluctuating payment amounts.

Flexible Term Lengths

Choose 3 months to 10+ years depending on your needs. Match the repayment timeline to the purpose of the capital.

Use Funds for Any Purpose

Working capital, equipment, expansion, payroll, inventory, marketing, and more. There are no restrictions on how you deploy the funds.

Builds Business Credit

Consistent on-time payments strengthen your credit profile for future financing at better rates and higher amounts.

Clear Total Cost

The full repayment amount is disclosed upfront. No hidden fees or compounding surprises.

Cons

Fixed Payments Regardless of Revenue

Unlike a merchant cash advance or revenue-based financing, term loan payments stay the same even during slow periods.

Qualification Varies by Term

Long-term loans require stronger financials than short-term products. Not every business qualifies for the term length it prefers.

No Revolving Access

Once the loan is disbursed, you cannot draw additional funds. If you need ongoing access to capital, a business line of credit is more flexible.

Alternatives to a Business Term Loan

Business Line of Credit

  • Revolving access to capital: draw funds as needed and repay to restore your limit
  • Only pay interest on the amount you actually use, not the full credit limit
  • Ideal for ongoing cash flow management, seasonal fluctuations, and recurring expenses
  • Credit replenishes automatically as you repay, with no need to reapply
  • Lower cost for businesses that need frequent, smaller draws rather than a lump sum

Merchant Cash Advance

  • Lump sum advance repaid through a percentage of daily credit card sales
  • No fixed payment schedule; repayment flexes automatically with your revenue
  • Fastest funding option, with a decision within 2 hours of complete documents and 24-hour deposits available
  • Minimal credit requirements and no collateral needed
  • Best for businesses with high card volume that need capital immediately

SBA Loans

  • Government-backed loans with the lowest interest rates available
  • Up to $5,000,000 with terms as long as 25 years for real estate
  • Multiple programs (7(a), 504, Microloans) for different business needs
  • Requires a 600+ credit score, 2+ years in business, and extensive documentation
  • Best for established businesses willing to wait for the lowest cost of capital

Frequently Asked Questions About

Business Term Loans

What is a business term loan?

A business term loan is a lump sum of capital you receive upfront and repay over a fixed period with regular payments: daily, weekly, or monthly. The repayment schedule, interest rate, and total cost are agreed upon before funding, giving you complete predictability. Once the loan is fully repaid, the obligation ends with no ongoing commitment.

What is the difference between a short-term and long-term business loan?

Short-term business loans have repayment periods of 3 to 18 months, faster approval, easier qualification (600+ credit score), and higher total cost. Long-term business loans span 1 to 10+ years, offer lower interest rates and larger amounts, but require stronger credit (650+), longer time in business (2+ years), and more documentation.

What credit score do I need for a business term loan?

For short-term business loans, most lenders require a minimum FICO score of 550. For long-term business loans, the minimum is typically 650. A higher credit score improves your chances of approval and qualifies you for lower interest rates, larger loan amounts, and longer repayment terms.

How much can I borrow with a business term loan?

Business term loans range from $5,000 to $5,000,000. The amount you qualify for depends on your monthly revenue, credit score, time in business, and the term length. Short-term products typically cap at $500,000, while long-term loans backed by the SBA or traditional banks can reach $5,000,000 or more.

Are business term loan interest rates fixed or variable?

Business term loans can have either fixed or variable interest rates. Short-term loans from alternative lenders almost always carry fixed rates, giving you payment certainty. Long-term bank and SBA loans may offer either option. Fixed rates mean your payment never changes; variable rates start lower but can increase over time.

Can I choose daily, weekly, or monthly payments?

Yes, payment frequency depends on the lender and the term length. Short-term loans from alternative lenders typically require daily or weekly payments deducted automatically from your bank account. Long-term bank loans and SBA loans usually offer monthly payment schedules. Rise helps you find a payment frequency that matches your cash flow.

Can startups qualify for a business term loan?

Startups with at least 6 months of operating history and $10,000 or more in monthly revenue can qualify for short-term business loans. Long-term loans typically require 2+ years in business. If you are pre-revenue or very early stage, alternative options like equipment financing may be available if you have collateral.

What documents do I need to apply for a term loan?

For short-term loans, you typically need 3 to 6 months of business bank statements, a government-issued ID, and basic business information (EIN, business license). Long-term loans require additional documentation including 2+ years of tax returns, profit and loss statements, a business plan, and sometimes a personal financial statement.

Are there prepayment penalties on business term loans?

It depends on the lender. Many short-term alternative lenders do not charge prepayment penalties, so you can pay off the loan early and save on interest. Some long-term bank loans and SBA loans may include prepayment penalties, especially in the first few years. Always confirm the prepayment terms before accepting any loan offer.

How is a term loan different from a line of credit?

A term loan provides a one-time lump sum with fixed payments over a set period. A line of credit gives you revolving access to funds. You draw what you need, repay it, and the credit becomes available again. Term loans are better for specific, one-time investments. Lines of credit are better for ongoing cash flow management.

How is a term loan different from a merchant cash advance?

A term loan has a fixed payment schedule regardless of your revenue. A merchant cash advance deducts a percentage of your daily card sales, so payments fluctuate with your revenue. Term loans offer lower total cost and predictability. MCAs offer faster funding, easier qualification, and payments that flex with your business performance.

Can I refinance an existing business term loan?

Yes, refinancing is common. If your credit profile, revenue, or time in business has improved since your original loan, you may qualify for a lower interest rate, better terms, or a larger amount. Refinancing replaces your existing loan with a new one, ideally at a lower total cost. Rise can help you evaluate whether refinancing makes sense.

What can I use a business term loan for?

Business term loans can be used for virtually any business purpose: working capital, equipment purchases, inventory, marketing campaigns, hiring, renovations, debt consolidation, expansion, or bridging seasonal revenue gaps. There are generally no restrictions on fund use, though some lenders may ask about the intended purpose during underwriting.

How fast can I get funded with a business term loan?

Short-term business loans from alternative lenders can be approved and funded within 24 to 48 hours. Long-term bank loans typically take 2 to 4 weeks. SBA loans can take 30 to 90 days due to government paperwork and guaranty processing. Rise connects you with lenders that match your timeline and urgency.

Is a business term loan right for my business?

A term loan is right if you need a specific amount of capital for a defined purpose and prefer predictable fixed payments. If you need flexible, ongoing access to capital, a business line of credit may be better. If you want payments that flex with your revenue, consider a merchant cash advance or revenue-based financing. For the lowest possible rates, an SBA loan is worth exploring if you can meet the stricter requirements. Use our business loan calculator to compare options.

Trusted by Small Businesses Across the USA

Decision After Complete Documents

Within 2 Hours

Funding Available

$5K to $5M

Businesses Funded

Across All 50 States

Term Loans in Your State

Available across all 50 states and Washington, D.C. Pick your state to see local programs, qualification specifics, and state-tailored FAQs.

Get a Business Term Loan Today

Whether you need short-term capital to bridge a gap or long-term financing for a major investment, Rise connects you with the right term loan. Predictable payments, clear terms, and funding as fast as 24 hours.

Apply NowPre-Qualify Now