Getting a $10,000 business loan can be much easier than larger amounts since you pose less of a risk to the lender by borrowing such a small amount. Online lenders, banks, credit unions and other financial institutions typically offer loans of this size – and might even offer different loan types including term loans, lines of credit, merchant cash advances and more.
Where can I get a $10,000 business loan?
You can get a $10,000 business loan with most types of lenders including online lenders, banks, credit unions and other financial institutions. Borrowing online might be a particularly good choice if you don’t have a lot of time or resources to spend on your business loan application, or you need the funds within 24-72 hours.
Many online lenders offer loan amounts starting from $1,000, while many banks typically start at $5,000. Before applying, be sure that the minimum funding amount is $10,000 or less.
Compare $10,000 business loans
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How can I qualify for a $10,000 business loan?
While eligibility requirements vary by lender, you generally need to meet the following criteria:
Time in business. Most lenders require that you’ve been in business for at least 1 year.
Annual revenue. Your business will likely need to bring in at least $5,000 a month in revenue, while some lenders may require $100,000 annually.
Personal credit. Lenders tend to rely on personal credit scores rather than business credit scores. You’ll likely need a good personal credit score of 650 or higher to qualify. It’s also common for business lenders to ask for a personal guarantee from the owner.
How much will a $10,000 business loan cost?
How much you’ll repay on a $10,000 business loan depends on 2 main factors: your loan’s APR and the loan term.
The APR is an expression of your loan’s interest rate and fees as a percentage. The lower the APR, the less you’ll pay in interest over the life of the loan. Since $10,000 is a small amount, you’ll pay very little in interest if you qualify for a competitive APR.
The loan term is the length of time that you have to pay back the loan in full. The shorter your loan term, the higher your monthly repayments will be – but a longer loan term means you’ll end up paying more in interest. For $10,000, you can expect a shorter loan term of anywhere from 3 months to several years.
Let’s take a look at an example …
Cornflower Media Co. needed to cover overhead costs for a film shoot coming up in the next month, but it didn’t have the cash to afford the cost up front. The owner compared her options and narrowed it down to 2 online lenders.
She prequalified with both and compared the results:
Lender
APR
Term
Turnaround time
Monthly repayment
Total cost
Lender #1
15%
1 year
Next business day
$902.58
$831
Lender #2
12%
1 year
A few business days
$888.49
$661.85
After weighing both options, she decided that Lender #1 was a better choice. While it cost slightly more, it had a faster turnaround time to get her the funds. And the longer she waited, the more expensive the overhead costs would get.
4 types of $10,000 business loans
From traditional term loans to lines of credit and merchant cash advances, here are 4 types of financing available in amounts as low as $10,000.
1. Business term loan
A business term loan comes in one lump sum, which you repay over a period of a few months to several years, plus interest and fees. Term loans of $10,000 are generally available through online lenders, banks and credit unions.
You typically need to have good personal credit and meet minimum revenue and time in business requirements. For a loan of $10,000, both secured and unsecured options might be available.
Consider using a term loan if …
You need to fund a one-time expense.
You and your business partners have good personal credit.
Consider other options if …
It’s hard to predict your business’s costs.
You have weak or poor credit.
2. Business line of credit
A line of credit makes sense when you have an ongoing project you need to fund, like construction or expansion. Rather than borrowing $10,000 all at once, you get access to a credit limit up to $10,000 – which you can draw from as needed. And, you only have to pay interest on the amount you actually borrow.
The same types of lenders that offer term loans also usually offer lines of credit. Similar eligibility requirements also apply.
Consider using a line of credit if …
You have costs that are unpredictable.
You and your business partners have good personal credit.
Consider other options if…
You only need funds for a one-time project.
You or another business partner have poor credit.
3. Equipment and vehicle financing
These term loans are backed by the equipment or vehicle that you’re using the funds to purchase, giving you lower rates. How much you can borrow depends on the price of the equipment or vehicle — some lenders will fund up to 100% of the cost, though many recommend at least a 20% down payment.
Consider using equipment or vehicle financing if …
You want to buy equipment or a vehicle for your business.
You’re looking for a more competitive deal.
You have the funds for a down payment.
Consider other options if …
You want to fund a project or need working capital.
You don’t have money for a down payment.
You don’t want to put up collateral.
4. Merchant cash advance
Retailers can get an advance on their future sales through this high-cost alternative to traditional business loans. Generally, merchant cash advances have less stringent eligibility requirements and a much faster turnaround — think a few days, rather than weeks.
Instead of interest, these come with a flat fee that you repay with a percentage of your company’s sales. However, these can be significantly more expensive than traditional financing.
Consider using a merchant cash advance if …
You own a retail business.
You’ve struggled to get financing elsewhere.
You don’t have the time to spend on a lengthy application.
Consider other options if …
You’re not in the retail industry.
You can qualify for a term loan or line of credit.
You have the time to spend on a more detailed application.
Bottom line
When it comes to business loans, $10,000 is on the low end – and both traditional and non-traditional lenders will offer loans of this amount. While it might be easier to qualify for $10,000 than larger amounts, you’ll still need to meet minimum credit score, revenue and time in business requirements in order to be eligible.
It’s possible, but most lenders have minimum time in business and revenue requirements. You might want to check out our guide to startup loans to learn more about your options.
You can, though not all lenders will work with you. Before applying for a loan, contact a lender to find out if they have a minimum credit score requirement.
You could, although you’ll have to apply through a bank or financial institution that offers CSBFP loans. You’ll also have to meet the eligibility requirements and use the loan funds for specific purposes. Due to the hands-on application and registration fee, it might be easier to apply for a business term loan or line of credit.
Emma Balmforth is a producer at Finder. She is passionate about helping people make financial decisions that will benefit them now and in the future. She has written for a variety of publications including World Nomads, Trek Effect and Uncharted. Emma has a degree in Business and Psychology from the University of Waterloo. She enjoys backpacking, reading and taking long hikes and road trips with her adventurous dog. See full bio
Anna Serio was a lead editor at Finder, specializing in consumer and business financing. A trusted lending expert and former certified commercial loan officer, Anna's written and edited more than 1,000 articles on Finder to help Americans strengthen their financial literacy. Her expertise and analysis on personal, student, business and car loans has been featured in publications like Business Insider, CNBC and Nasdaq, and has appeared on NBC and KADN. Anna holds an MA in Middle Eastern studies from the American University of Beirut and a BA in Creative Writing from Macaulay Honors College at Hunter College, CUNY. See full bio
Anna's expertise
Anna has written 61 Finder guides across topics including:
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