Acquiring funds for your small business doesn’t have to be a tedious process. With a no-doc business loan, you can gain access to lines of credit, merchant cash advances, and other forms of funding without excessive documentation like a traditional loan.
What is a No-Doc Business Loan?
A no-doc business loan is a form of business financing that requires far less documentation than traditional business loans, including Small Business Administration (SBA) loans. However, although the name implies that the business loan requires no documentation, most lenders still need some level of paperwork for no-doc business loans. Nevertheless, the requirements are much less tedious than traditional loans.
There are four main types of no-doc business loans, namely a business line of credit, invoice factoring or financing, merchant cash advances, and short-term loans. We will go over these business loan types in greater detail below.
The Best No-Doc Business Loans
What banks offer no-doc business loans? We’ve compiled some of the top options for the savvy small business owner:
Credit Suite Credit Line Hybrid
Credit Suite’s Credit Line Hybrid Program offers flexible financing with no collateral and the least amount of documentation possible. This credit card stacking program functions like a line of credit, except the funds continuously revolve as long as the borrower repays the line monthly.
The Credit Line Hybrid offers up to $150,000 per individual with 0% interest for 6 to 18 months. There are no income, assets, cash flow, or collateral requirements, making it a great alternative to a traditional loan or even an unsecured business line of credit for startup companies.
Aside from being a “no-doc business loan” as it can get and offering top-notch interest rates, the Credit Line Hybrid Program takes three weeks or less to process, and you can get a pre-approval in 24 hours. These features make it easier for business owners to access business loan funds as quickly as possible, which can help pay for urgent business expenses or hop on sudden opportunities.
To qualify for this loan, you need a personal credit score of at least 680. Plus, you must not have any liens, judgments, bankruptcies, or late payments; have less than five inquiries per bureau in the last 12 months; and have under 40% utilization on all revolving accounts.
If you don’t meet these requirements, you can bring in a credit partner who does—perhaps a friend or business co-owner—to access their credit and provide a personal guarantee for the loan.
Fundbox Business Line of Credit
Fundbox’s Business Line of Credit can get borrowers up to $150,000 to help pay for payroll, inventory, and other general business expenses. Repayment terms are flexible, ranging from 12 to 24 weeks, and there’s no prepayment penalty.
A no-doc business line of credit is similar to a business credit card, in the way it allows borrowers to pay for typical expenses without having to gather extensive documentation, as you would with a traditional business loan. However, you would have to pay off the line to continue using it, just like a credit card.
A great thing about Fundbox’s Line of Credit is you can apply entirely online. All you have to do is download their app, sign up for an account, and connect your financial software. If the lender approves your application, you can receive funding as quickly as the next business day.
Moreover, qualifications are less stringent than an SBA loan. To qualify for Fundbox’s Business Line of Credit, you need a 600+ personal FICO score, $100,000 in annual revenue, and a business checking account. Applying with this lender is easy and you can receive a decision in as little as three minutes.
Clarify Capital Low-Doc Equipment Financing
For small business owners, new equipment tends to be the heaviest purchase regardless of how long they’ve been operating. To help lighten this load for businesses, Clarify Capital offers a low-doc loan for equipment acquisitions, including computers, heavy machinery, vehicles, and more.
With this type of low-doc business loan, you receive an amount depending on the price of the equipment you’re purchasing. Moreover, the length of the loan will also rely on the expected life of the equipment, so it’s ideal to choose a repayment plan that matches how many years you expect to use the equipment.
The piece of equipment will serve as collateral for the low-doc loan. Once you pay off the loan amount, the lender transfers complete ownership to you.
Clarify Capital’s Equipment Financing lets small business owners borrow up to 100% of the equipment value with interest rates as low as 6%. The minimum personal credit requirement is 550, and the paperwork is minimal to ensure a smoother process.
New equipment often translates to business growth, but if you can’t afford to buy equipment with cash or apply for a traditional bank loan, a low-doc equipment loan is a much more accessible alternative.
Raistone Invoice Financing
Invoice financing or factoring is a type of business financing that allows business owners to access funding quickly using outstanding invoices. With this kind of no-doc loan, businesses can use unpaid invoices as collateral or sell them to the lender directly.
This type of funding works best for businesses with a business-to-business (B2B) model and receivables. Usually, these companies sell goods or business services to large clients on credit. The clients then receive invoices with the total balance and due date, meaning they don’t have to pay immediately after receiving the goods or services. For some, unpaid invoices can lead to cash flow issues.
Companies like Raistone offer invoice financing, which finances invoices to help businesses have liquidity sooner than having to wait for customers to pay their balances. The lender takes a percentage of the invoice as payment for the loan.
The qualifications for this type of loan vary. For instance, Raistone Capital borrowers qualify for an amount based on their revenue, their customers’ creditworthiness, and their payment terms. Moreover, this lender can integrate with customers’ invoicing platforms to help borrowers see what can be financed. However, these no-doc business loans can be structured in a way that the customers don’t know that their invoices have been financed.
Greenbox Capital Merchant Cash Advance
Merchant cash advances (MCAs) provide a quick source of cash for businesses that need to increase working capital but have no collateral, making it some of the easiest no-collateral business startup loans. Essentially, you are borrowing money against future debit or credit card sales. In return, the lender receives a percentage of your sales multiplied by a factor rate.
Most MCAs use factor rates instead of interest rates. Factor rates, which are usually between 1.1 and 1.5, are multiplied by the original loan amount. For example, a $50,000 loan with a factor rate of 1.1 will amount to $55,000.
Greenbox Capital offers a merchant cash advance to businesses averaging at least $7,500 in revenue per month for three months before application. Advances come to 70% to 120%, which can be anywhere from $3,000 to $500,000. It’s a great option for establishments that need quick cash and process many card transactions, but have no collateral or have bad credit scores.
Another point of convenience for the Greenbox merchant cash advance is the minimal requirements, similar to other types of no-doc business loans. Generally, all you need are three months of bank statements and a handful of other financial documents. Credit approval can take as little as a few hours and, if approved, Greenbox will deposit your funds within 24 hours.
American Express Business Line of Credit
American Express presents a flexible business financing solution to small business owners who need quick and easy access to funding. The Amex Business Line of Credit is available to borrowers with at least a 660 credit score, an average monthly revenue of at least $3,000, and 12 months of business operation. Amex Small Business Card Members may have pre-approval.
The lender will determine how much you can borrow based on your prior credit, repayment history, business bank accounts, and other information from your business and personal credit report. Additionally, you can link your business bank account to your application to allow Amex to review your eligibility in real-time.
Essentially, you will have flexible access to the loan and can borrow as much as you need, when you need it. Each withdrawal is a separate loan with corresponding loan fees. You will then have to make monthly payments, and the line of credit may replenish based on an ongoing review of your financial profile.
You can apply for this line of credit through their online banking app and choose a 6, 12, 18, or 24-month loan term. Plus, you only have to pay fees for the amount you borrow and there are no prepayment penalties if you decide to pay your balances early.
OnDeck Term Loan
OnDeck’s business term loan is similar to a traditional small business loan or personal loan, except the application process is faster and the required documents are fewer. This lender provides funding from $5,000 up to $250,000 with a flexible repayment term of up to 24 months. You can set daily or weekly payments and qualify for prepayment benefits if you wish to pay off the loan early and have the remaining interest waived.
In addition, OnDeck’s small business loan payments are fixed, meaning you’ll pay the same amount throughout the loan. This arrangement can help you manage your cash flow more efficiently and set up auto-debit on one of your business bank accounts with confidence.
Another benefit of OnDeck’s small business term loan is that the application won’t require a hard credit pull. You can complete your application quickly and, once approved, receive funding as soon as the same day. Plus, OnDeck reports to business credit bureaus, which will help you grow your business’ credit history and grow your business further.
What’s the difference between a term loan and a line of credit? With a term loan or unsecured business loan, you receive a lump sum rather than borrowing smaller increments with a credit line. This type of loan is best for large expenses, such as buying new equipment, paying a deposit on a new property, and hiring additional employees.
FundThrough Invoice Factoring
FundThrough invoice financing aims to fill cash flow gaps resulting from unpaid invoices or slow-paying clients. With their invoice-funding platform, borrowers can receive funding for invoices in days rather than weeks or months, and all with an easy-to-use platform you can integrate with your QuickBooks or OpenInvoice account.
Aside from receiving payments early, another major benefit of using FundThrough is the paperwork is minimal. With a free FundThrough account, you simply upload invoices or pull eligible ones from other accounting platforms, then choose an invoice to fund. Once approved, FundThrough will deposit the loan amount into your account as soon as the next business day.
Aside from small businesses, FundThrough’s invoice financing has proven extremely beneficial for a lot of other industries, including but not limited to wholesale, engineering, information technology, automotive, agriculture, and trucking. Like other invoice financing companies, FundThrough works best for B2B businesses, but it can also be a viable option for business-to-consumer (B2C) businesses.
This type of flexible business loan can help your business grow faster by giving you the liquidity to invest in new equipment, hire more employees, purchase more inventory, or expand your building. But unlike a traditional business loan, you won’t have to shell out dozens of bank statements, credit histories, and other time-consuming requirements.
Bluevine Business Line of Credit
Bluevine is another online lender that offers a line of credit up to $250,000. Like other no-doc business loans on this list, they allow borrowers to take only what they need and pay fees for only the amount they use. The line of credit is designed to help business owners access funds on demand and replenish their credit upon repayments.
However, your line of credit is not fixed. Bluevine continuously evaluates your financial profile and adjusts your limit, ensuring your business loan credit grows with your business.
To qualify for Bluevine’s business line of credit, you need at least 24 months of business operation, a 625+ credit score, and at least $40,000 in monthly revenue. Moreover, you need to present bank statements from the last three months, and your business must be in good standing with your Secretary of State. Note that businesses in Nevada, South Dakota, and North Dakota are not eligible.
With these requirements in mind, Bluevine’s no-doc business loans best fit medium to large businesses with a sizable, steady revenue, no bankruptcies in the past 12 months, and a good credit history.
Upon approval, you can receive funding in as little as 24 hours. From there, you can repay each draw with fixed weekly or monthly payments over a 6- or 12-month period.
TD Bank Business Solutions Credit Card
Business credit cards are a great option for borrowers who only need a small or moderate limit, smaller than a line of credit or other types of no-doc business loans. They are like startup business loans with no revenue requirements.
One such card is the TD Business Solutions Credit Card, which offers an unlimited 2% cashback on all eligible purchases, Visa benefits (e.g., cellphone insurance), contactless payments, and a $400 cashback (in statement credit) when you spend $3,000 within the first 90 days.
In addition, there are no rotating Spend Categories, caps, or limits, as long as your credit is in good standing, and no annual fee if you qualify. You can also add your credit cards to a TD digital wallet to streamline your online purchases and monitor your account more efficiently.
Most business credit cards offer smaller limits than business lines of credit and have higher interest rates. However, unlike a line of credit, a business credit card can come with rewards, including cashback and points, and may be accessible to those with bad credit.
Conclusion
A no-doc business loan can be an excellent alternative to traditional small business loans from a bank or credit union, especially if you need a sizable amount of funds quickly. No-doc business loans can also be a viable option for business owners with bad credit, low revenue, or a limited business history. Whatever the case may be, the most important takeaway is to choose a business loan that will work best for you.
