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How Long Does It Take to Get a Business Loan?
January 20, 2022
How Long Does It Take to Get a Business Loan

How Long Does It Take to Get a Business Loan?

No matter what type of business you’re involved in, you may need fast funding at some point in time. Maybe you found the perfect commercial real estate property and want to secure it before someone else does. Or perhaps you locked in a good deal on inventory that will expire soon.

So, how long does it take to qualify for a business loan and how long does it take to get a business loan? Let’s take a closer look at the typical timeframe as well as what you can do to expedite the loan process.

Business Loan Timeline

There are countless business loan programs out there. Each one comes with its own timeline so the answer to how long does a business loan take to get approved varies. While some loans offer quick funding the same day you apply or within 24 hours, others take weeks or even months.

If you opt for a traditional business loan from a bank, for example, you’ll likely have to wait several weeks to get approved and receive the money. On the other hand, if you choose a merchant cash advance or invoice factoring, you can expect approval and funding within a few days.

SBA Loan Timeline

U.S. Small Business Administration or SBA loans are popular because they offer low rates and long repayment terms you may not be able to find elsewhere. To apply for one, you’ll need to work with an SBA preferred lender, which can be a bank, credit union, or an online lender.

Timelines for SBA loans depend on the lender and the type of SBA loan you choose.

Some lenders state that they can get your SBA loan application approved and closed in about 45 days. Others claim the SBA loan process will take longer. If you require fast funding, an SBA loan most likely won’t be the best fit.

​​What to Expect From the Loan Process

Now that you understand how long it may take to get a business loan, you may be wondering what’s involved in the approval and funding process. The first part is the application process where you fill out the lender’s application online or in-person. You’ll be asked to provide personal and financial details. You might also have to attach documentation such as bank statements, business plans, and tax returns.

Once your application has been submitted, the underwriting process will begin. This is where the lender will carefully review your borrower profile to determine whether to approve you for a loan and what types of interest rates and terms to offer. While some lenders have an automated underwriting process, others go the manual route, which typically takes several days.

Upon approval is the funding stage. During funding, the lender will distribute your funds. If you choose direct deposit, you should see them in your bank account in as little as a few hours. A check or prepaid card, however, will likely take a few days.

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How to Speed Up the Business Loan Process

Although you can’t control every aspect of the business loan process, there are some things you can do to speed it up. If you need business funding as soon as possible, follow these steps.

1. Choose the Right Loan Type

As we previously mentioned, some types of loans are faster than others. A traditional term loan or business line of credit from a bank will take longer than equipment financing or a credit card. If you can’t wait for the money, purposely shop for loans from lenders that are known for quick approvals and funding.

Just keep in mind that it may cost you more or require you to put up collateral such as your commercial property or company vehicle.

2. Apply on a Weekday

Since many small business owners have more availability on the weekends, they tend to apply for business financing then. If possible, try to fill out your application during the week, any time Monday through Friday. Business lenders won’t have as many applications to review and may get to yours sooner.

3. Prepare Financial Documents 

Before you apply for a business loan, take the time to collect all the documents you may need to attach. These may include bank statements, tax returns, and a business plan. If you’re unsure of which documents you need to apply, check out the lender’s website or reach out to them for clarity.

4. Answer Questions On Time

After you fill out a loan application, a lender may call or email you with questions. When they reach out with questions, be sure to answer them as soon as possible. If you take days or weeks to get back to them, you’ll substantially delay the process.

5. Choose Direct Deposit

As long as you have a valid and active business bank account, you’re eligible for direct deposit, assuming the lender offers it. Compared to checks and prepaid cards, direct deposit is the fastest funding option. Note that you prefer it on your application.

Conclusion: Be Patient When Applying for a Small Business Loan

In a perfect world, you’d apply for a loan, get approved right away, and receive the money shortly afterwards. Since this may not be the case, it’s important to be patient and do whatever you can to speed up the business loan process!

Fora Financial

Editorial Note: Any opinions, analyses, reviews or recommendations expressed in this article are those of the author's alone, and have not been reviewed, approved, or otherwise endorsed by any of these entities.

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Fora Financial is a working capital provider to small business owners nationwide. In addition, the Fora Financial team provides educational information to the small business community through their blog, which covers topics such as business financing, marketing, technology, and much more. If you’d like to see a topic covered on the Fora Financial blog, or want to submit a guest post, please email us at [email protected].