Small business loans for veterans refer to business funding given to veterans, active service members and their spouses or widows, to help them start or grow a small business.
Below, we take a look at the various VA loans available, and how to qualify for a small business loan.
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Best Small Business Loans for Veterans:
SBA 7(a) Loan
2.25% - 4.75% + prime
Up to $5 million
Guaranteed term loans with very attractive terms processed through banks and credit unions. They allow for several uses of funds, including working capital and equipment financing.
SBA Express Loan
4.5% - 6.5% + prime
Up to $350,000.00
Ideal for businesses needing fast financing. Offers flexible repayment terms and is up to 50% guaranteed, but requires a high credit score.
Military Reservist Economic Injury Disaster Loan
Up to $2 million
Loan designed to help reservists rebuild their business after returning from deployment. Offers low interest rates and repayment terms up to 30 years.
Online Business Loan
5.0 - 99%
Up to $100,000.00
Offered by non-traditional lenders. A good option if you are not able to get a traditional bank loan or need fast funding. You can expect an easy application process and fast turnaround times, but also high interest rates.
Personal Loans for Veterans
Starting at 3.34%
Up to $100,000.00
There are a number of personal loan options available to veterans, ranging from lenders catering exclusively to veterans to non-traditional lenders with relaxed credit score requirements.
Things to Consider When Evaluating Small Business Loans for Veterans:
- Look at the eligibility requirements.
- Evaluate loan rates and repayment terms.
- Find out about any other financial products and resources beneficial to veterans.
Why We Chose Wells Fargo as the best SBA Lender:
Wells Fargo in an approved SBA lender that offers a wide selection of small business financing solutions at attractive rates as well as a host of resources to help small businesses grow.
Wells Fargo offers long repayment terms and lower down-payments for SBA-backed loans, making funding more affordable and accessible to qualifying veteran-owned small businesses.
Best SBA Lenders:
Maximum Loan Amount
A trusted lender with locations across the country. Offers a variety of small business loans, including SBA 7(a),SBA 504, and SBA Express loans.
Easily accessible national lender. Offers SBA 7(a), SBA 504, and SBA Express loans and does not require collateral for SBA loans under $25,000.
Huntington National Bank
Offers basic SBA 7(a), SBA Express, and SBA 504 loans and is known for good customer service. Not available in all regions.
Live Oak Bank
Specialized SBA lender known for fast turnaround times. Requires a minimum personal credit score of 680 for SBA loans and caters only to certain industries.
Provides SBA 7(a), SBA 504 loans, and SBA Express loans, and offers low interest rates, but has stringent qualification requirements and only operates in 15 states.
Why We Chose StreetShares as the Best Non-traditional Lender:
StreetShares has very lenient minimum qualification requirements, such as a very low annual revenue requirement of $25,000, making small business financing easily accessible to veterans.
StreetShares offers fast and affordable small business financing solutions for veterans with convenient terms and does not charge a prepayment fee.
Best Non-traditional Small Business Loan Providers for Veterans:
Maximum Loan Amount
A veteran-led online lender that offers fast small business loans at competitive rates with no prepayment fees that are accessible to low-revenue new businesses.
Offers term loans and lines of credit at high rates but has looser qualification requirements than traditional lenders.
Automated lending platform that provides businesses with quick and easy access to small amounts of funding.
Offers short-term loans and has relaxed credit score requirements, but can get expensive.
Ideal for businesses needing fast loans and cash advances for small amounts.
A peer-to-peer lending service with easy online application and fast processing times.
A non-profit lending network that only offers small loans, but has relaxed credit score requirements and no prepayment penalty.
How do veterans get small business loans?
How do I qualify for a VA business loan?
Veterans, including active service members, former members, service-disabled veterans, and their spouses or widows, and those in the Reserve or National Guard are eligible to apply for small business loans for veterans.
According to the SBA, a veteran or their spouse/widow must own at least 51% of an existing business to qualify. Veterans who wish to open a business are not required to have a minimum credit score, however, most VA lenders do impose a personal credit score of at least 620 to qualify for a VA loan.
For more information on how to qualify for a small business loan through the SBA, visit sba.gov.
Can I get a VA business loan with bad credit?
How much can I get for a VA small business loan?
Veterans can receive a maximum of $350,000.
How do I register a disabled veteran owned business?
Disabled veterans can apply to the SBA 8(a) Service-Disabled Veteran-Owned Business Contracting Program. To qualify, you need to have a veteran-owned business (with 51% ownership) and have one or more service-disabled veterans managing the day-to-day operations of the business.
If you're interested in applying for a grant, be sure to read our article on Small Business Grants for Veterans.
What is a VA Business Loan?
VA business loans comprise three Small Business Administration (SBA) loans, namely: the SBA 7(a) Program, SBA Express Loans, and Military Reservist Economic Injury Disaster (MREIDL) loans. MREIDL loans are provided to businesses to cover the financial cost of an employee who has been recruited for military service and is no longer able to contribute to the business while they are away.
SBA loans for veterans are guaranteed up to a certain amount and there is no upfront fee for those who qualify for loans up to $350,000. VA loan rates range from 4.0% to 6.5%, depending on the loan amount.