Long-Term Business Loans: Best Options
Long-term business loans offer repayment periods that can reach up to 10 years or sometimes more, making them ideal to help grow a small business. These loans can be used for anything from investments to remodeling, all while giving the business owner plenty of time to pay them down.
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Best long-term business loans
We’ve rounded up the best long-term business loans in the market today that are great options for small business financing needs.
| Lender | Best for | Maximum amount | Maximum term length | Minimum credit score |
|---|---|---|---|---|
 | Overall | $5,000,000 | 300 months | 680 (recommended) |
| Commercial real estate loans | $5,000,000 ($5,500,000 for energy projects) | 300 months | Not applicable |
 | Conventional commercial real estate loans | $3,000,000 | 180 months (up to 25-year amortization) - Commercial real estate loan | Not disclosed |
 | Online lender for secured term loans | $500,000 | 84 months | 660 |
 | Secured term loans | $250,000 | Up to 60 months, with CD as collateral | Not disclosed |
 | Long-term equipment loans | $2,000,000 | 84 months | 550 |
Learn more about how we chose our picks.
SBA 7(a) loan: Best overall
| Term length | 120 to 300 months |
|---|---|
| Max. amount | $5,000,000 |
| Est. interest rate | Fixed or variable, based on current Prime Rate (3.00% at time of editing) |
| Min. credit score | No minimum (680 recommended) |
| Min. time in business | 2 years |
No minimum credit score
Loan amounts up to $5,000,000
Possible down payment of 10% to 20%
Collateral may be needed for loans over $350,000
SBA 504 loan: Best for commercial real estate
| Term length | 120 to 300 months |
|---|---|
| Max. amount | $5,500,000 |
| Est. interest rate | Approx. 3.00% of the total amount financed |
| Min. credit score | Not applicable |
| Min. time in business | Not applicable |
Fixed, low-interest rates
Long repayment terms
Down payment of at least 10% of the loan
May come with fees
PNC: Best for conventional commercial real estate loan
| Term length | 60 to 180 months Up to 300 month amortization |
|---|---|
| Max. amount | $3,000,000 |
| Est. interest rate | Fixed or variable rate, starting rate not disclosed |
| Min. credit score | Not disclosed |
| Min. time in business | 3 years |
Large loan amounts from $100,001 to $3,000,000
Long repayment periods
Website is not transparent about eligibility requirements, including credit score and annual revenue
Need to be in business for 3 years
Funding Circle: Best for long-term loans from an online lender
| Term length | 6 to 84 months |
|---|---|
| Max. amount | $500,000 |
| Est. interest rate | 11.29% to 30.12% |
| Min. credit score | 660 |
| Min. time in business | 2 years |
Loan amounts from $25,000 to $500,000
Term lengths from 6 to 84 months
Collateral may be required
Origination fees range from 4.49% - 10.49%
Bank of America: Best for secured term loans
| Term length | Up to 60 months, with CD as collateral |
|---|---|
| Max. amount | $250,000 |
| Starting interest rate | 7.25% |
| Min. credit score | Not disclosed |
| Min. time in business | 2 years |
Discounts on fees or rates offered to veterans and some Bank of America checking account customers
In-person customer service may be available
Website not transparent about eligibility requirements
Origination fee of 0.50%
Taycor Financial: Best for equipment loans
| Term length | 12 to 84 months |
|---|---|
| Max. amount | $2,000,000 |
| Est. interest rate | 3.49% to 28.00% |
| Min. credit score | 550 |
| Min. time in business | Start-up financing (typically 6 months) |
Funding within 24 hours of approval
No down payment required
Documentation fee
Can come with high-interest rates
What is a long-term business loan?
Long-term business loans generally offer repayment terms from three to 10 years, but can reach up to 25 years depending on the lender. Because of their extended repayment windows and generally higher loan amounts, long-term business loans are often used for business growth projects, such as buying commercial real estate, purchasing large machinery, or building expansion.
How does a long-term business loan work?
Long-term business loans are usually paid in monthly, fixed installments of interest and principal, following an amortization schedule that provides an estimate of the time it will take to pay down your loan.
Since long-term business loans often are secured by collateral, the risk to lenders is somewhat lower and, as a result, may come with lower interest rates. With commercial real estate or equipment financing, the property or machinery itself acts as collateral, but cash deposits can be another form of collateral accepted with some long-term business loans.
Long-term vs. short-term loans
In addition to term length, there are several other key differences between long-term small business loans and short-term business loans.
| Long-term business loans | Short-term business loans | |
|---|---|---|
| Repayment term lengths | 36 to 120 months | 3 to 24 months |
| Repayment frequency | Monthly | Usually daily or weekly |
| Starting Interest rates | 6.5% APR or higher | 7% to 50% or higher |
| Time to funding | Several business days to 2 to 3 months | Same day upon approval up to three business days |
| Borrower requirements |
|
|
| Collateral required | Often | Not usually |
| Purposes | Long-term financial growth and company expansion | Upfront and unexpected costs for a new project or emergency |
Where to find long-term business loans
You can find long-term business loans from several different types of lenders. Choose the right option for your business.
SBA loans
The U.S. Small Business Administration (SBA) offers several types of long-term business funding. While the 7(a) loan is most popular for building or buying inventory, the SBA 504/CDC loan is geared more toward purchasing fixed assets, like machinery, equipment or real estate. SBA microloans also offer longer-term funding, geared toward providing financial help to underserved markets with low income applicants and women- or minority-owned businesses.
SBA 7(a) loans
Maximum term length: 120 to 300 months, depending on loan purpose
Maximum loan amount: $5,000,000
SBA 504 loans
Maximum term length: 120 to 300 months, depending on loan purpose
Maximum loan amount: $5,500,000
SBA microloans
Maximum term length: 72 months
Maximum loan amount: $50,000
Bank loans
Traditional brick-and-mortar banks commonly offer long-term business loans. Repayment terms can vary by bank, but common repayment terms range between 4 to 7 years. Loan amounts that can start at $25,000 and reach up to $3,000,000. Traditional banks may also offer long-term conventional commercial real estate loans, with terms often up to 15 years. Funding times with banks can be faster than SBA loans, but approval can often take weeks or months. Eligibility and credit requirements may also be more stringent when compared with an online lender.
Credit unions
Credit unions are nonprofit financial institutions, often based in a local community or dedicated to serving a specific industry. To qualify for a long-term business loan from a credit union, you’ll first need to be a member of the credit union. Depending on the specific credit union, you may need to apply for a business loan in person as opposed to online. However, credit unions are community-focused and can be more willing to approve newer small businesses than traditional banks.
Online lenders
Most online business lenders tend to offer short-term loans, but some may offer longer-term loans as well. Borrower requirements can be more lenient and funding is usually relatively fast, delivered within a few days, but online lenders may come with high interest rates and fees.
How to apply for a long-term loan
Once you choose a lender, the application process would likely start with some paperwork requesting basic information about your company, how much money you need and how you plan to spend it.
Next, a lender may review these basic requirements:
- Credit score: Lenders check credit history to determine your risk as a borrower. The lower your score, the higher your interest rate might be if you are approved. Lenders may prefer borrowers who have a personal credit score of around 700 (at least 680), although some online lenders may accept a score as low as 550.
- Time in business: Most lenders want to see that you’ve been in business for some time. Two years in business is often a standard minimum for term loans.
- Business revenue: Lenders will evaluate your annual gross revenue, including all of your sales and other sources of income. Your revenue and cash flow will give lenders an idea of whether or not your business could repay a loan.
Your term loan application may require a few additional documents. It may be helpful to have some essential information on hand before sitting down to apply:
- Business plan
- Business and personal bank account statements
- Business tax returns and personal tax returns
- Proof of business registration and licenses
- Employer identification number
- Profit and loss, cash flow and balance sheet
- Proof of collateral (if required)
- Business assets and liabilities
Pros and cons of long-term business loans
| Pros | Cons |
|---|---|
May come with low-interest rates. Term loans could help build business credit. Manageable, fixed monthly payments and fixed interest rates that allow you to plan for payment. Most term loans do not specify how businesses can spend the money. | Term loans may have a lengthy time-to-funding timeline. Some businesses don’t qualify for a long-term loan. Long-term business loans may have long documentation processing time. Companies usually need at least two years in operation, a strong credit score and existing collateral to be eligible for a long-term loan (in most cases). |
How we chose our picks
To appear on our list of best long-term business loans, we selected lenders that offered:
- Term loans of four years (48 months) or greater
- Maximum loan amounts of $100,000 or greater
- Credit scores below 700 considered