What credit score do you need for a business loan?
Reviewed by Turan Zeynal, Managing Partner, Outset Funding Partners ·
There is no single 'business loan' credit score. The real minimums depend on the product: SBA 7(a) 680+, bank term loans 660+, online term loans 600+, business lines of credit 625+ (fintech) or 660+ (bank), equipment financing 550+, and merchant cash advances 500+. Almost every product also personally guarantees the loan against the owner's FICO — the business's own credit score matters less than most owners think.
Quick facts
- SBA 7(a) loan
- 680+ FICO (SBSS 155+)
- Bank term loan
- 660–700+ FICO
- Online term loan
- 600+ FICO
- Bank line of credit
- 660+ FICO
- Fintech LOC
- 625+ FICO
- Equipment financing
- 550–600+ FICO
- Merchant cash advance
- 500+ FICO
- Invoice factoring
- No FICO minimum (customer credit matters)
The 60-second answer
The question "what credit score do I need for a business loan" doesn't have one answer because "business loan" isn't one product. It's a stack of very different products, priced very differently, with very different minimum scores. Asking a lender "do I qualify" without saying which product is like asking a mechanic "how much" without saying which car.
Below is the honest breakdown by product, the score bands that actually get approved (not the marketing minimums), and what changes when your personal FICO moves 40 points.
Pros and cons
- ✓Every score band has at least one legitimate funding product — nobody is truly locked out
- ✓Personal FICO can be improved 40–80 points in 90 days with the right moves (payoff below 30% utilization, dispute stale items)
- ✓Adding one business tradeline that reports pushes Experian Business and D&B scores meaningfully in 60–90 days
- ✓SBSS (SBA's blended score) rewards on-time business tradelines, not just personal FICO
- ✓A single strong co-signer (700+ FICO, W-2 income) can unlock products two tiers above your own score
- ×Below 500 FICO, the only products left are invoice factoring and secured equipment leases
- ×Personal guarantee is standard on every product except invoice factoring — the business's own credit doesn't shield the owner
- ×A recent bankruptcy (under 2 years old) blocks SBA and most bank products regardless of FICO
- ×Rate hikes below 640 are steep — the same lender may quote 12% at 660 and 24% at 620
- ×Multiple hard pulls in 30 days can drop a score 10–20 points at exactly the wrong time
Real approval minimums by product
| Option | When to use | Watch out for |
|---|---|---|
| SBA 7(a) | 680+ FICO, 2+ yrs in business, positive cash flow | SBSS score also pulled; a low SBSS kills a great FICO |
| Bank term loan | 660–700+ FICO, 2+ yrs, profitable last year | Debt-to-income and DSCR matter as much as score |
| Online term loan | 600+ FICO, 6+ mo in business, $10k+/mo revenue | Rates jump sharply below 640 |
| Line of credit (bank) | 660+ FICO, 2+ yrs, blanket UCC | Requires financials, tax returns, sometimes collateral |
| Line of credit (fintech) | 625+ FICO, 12+ mo in business | Draw fees per pull; not truly revolving |
| Equipment financing | 550–600+ FICO, equipment is the collateral | The equipment secures the loan; personal FICO still matters |
| Merchant cash advance | 500+ FICO, 4+ mo bank stmts, $10k+/mo deposits | Factor rates 1.15–1.50 — expensive but score-lenient |
| Invoice factoring | No FICO minimum — your customer's credit is what's underwritten | Only works if you invoice creditworthy B2B customers |
Frequently asked questions
What credit score do you need to start a business loan?
For startup businesses (under 6 months) the personal FICO minimum jumps because the lender has no revenue history to underwrite. Most online startup lenders want 680+. SBA microloans allow 620+. Below 620, look at 0% intro-APR business credit cards and equipment leases.
Do business loans check personal or business credit?
Both. Every non-SBA lender pulls the owner's personal FICO (Experian, Equifax, or TransUnion). Larger loans and SBA also pull business credit (Experian Business, D&B PAYDEX, and the SBA's SBSS blended score). For loans under $100k, personal FICO drives 80% of the decision.
What's the minimum credit score for SBA loans?
The SBA doesn't publish a hard minimum, but SBA-preferred lenders effectively require 680+ personal FICO and an SBSS score of 155+ for a 7(a) loan. SBA microloans (under $50k) go down to 620+. SBA Express goes down to 650+.
Can you get a business loan with a 500 credit score?
Yes — merchant cash advance, invoice factoring, and some secured equipment lenders will fund at 500. Traditional term loans and lines of credit won't. Expect factor rates of 1.30–1.50 (roughly 60–150% effective APR) until your score climbs.
How fast can I raise my score to qualify?
Realistically, 40–80 points in 90 days if you (1) pay every revolving card below 30% utilization, (2) dispute inaccurate collections, and (3) don't apply for new credit during that window. Beyond that, real growth takes 6–12 months.
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