EIN-Only Startup Business Loans
Last Updated: By TRUiC Team
Getting a business loan for your startup with just an EIN (Employer Identification Number) can be challenging but not impossible.
This guide will help you qualify for an EIN-only loan and tell you which loans and what lenders to explore.
Recommended: You can get a BILL Divvy Corporate Card with only an EIN, which will support your business and help it build business credit.
Best EIN-Only Lenders
While many lenders require a personal guarantee or a mix of personal and business credit, a select few focus primarily on EIN for business loan applications, catering mainly to startups.
Here are some of the best EIN-only lenders:
- BILL: As mentioned, BILL is an excellent option for startups looking to build their business credit. Their offering is designed for businesses to manage expenses and scale, all while only using an EIN.
- Uplyft Capital: Providing a holistic approach to business funding, Uplyft Capital prides itself on fast approvals, competitive rates, and personalized support. They offer a range of products that cater to different business needs, making them a preferred choice for many startups.
- Lendio: Catering primarily to startups, Lendio is a go-to for entrepreneurs who want to compare various lending options conveniently while focusing solely on their EIN for the application. Their extensive network ensures that businesses get competitive rates, suitable terms, and a tailored approach, making financing a hassle-free experience.
- Uncapped: Known for its flexibility and ease of use, Uncapped provides lines of credit based on real-time business data. Their process is streamlined, making it a popular choice for startups eager to access funds quickly.
When considering an EIN-only lender, it's essential to research and compare the terms offered by different lenders. This not only ensures that you get the best rates but also helps in building a long-term relationship with a lender that understands and caters to your business's unique needs.
Startup Business Loan Options Using EIN
Regarding business financing, securing funds without tying them to a personal guarantee is often the goal for many entrepreneurs. This is particularly true for those who may have existing business debts or are cautious about intertwining personal and business financial matters.
Using an EIN for loan applications provides businesses, especially startups, a pathway to funding without putting personal assets at risk. There are a variety of small business loans tailored for such scenarios.
Entrepreneurs can explore various EIN-based loan options:
Term Loans
Ideal for businesses with a reliable debt repayment history, these loans allow small business owners to borrow a fixed amount and repay it over a predetermined period.
Lines of Credit
Offering flexibility, a business can borrow up to a predetermined limit and only pay interest on the amount they've used. It's a favorite among businesses keen on managing unpredictable cash flows.
Equipment Financing
For startups in need of new machinery or tech, equipment financing focuses on loans for buying business essential equipment, often using the purchased equipment as collateral.
Invoice Financing
Businesses with delayed invoice payments can use invoice financing to use their unpaid invoices as collateral, ensuring consistent cash flow.
Merchant Cash Advances
Designed for businesses with strong credit card sales, this option gives cash upfront based on projected credit card sales. However, businesses should be cautious of potentially high interest rates.
Additionally, as the business financing landscape evolves, alternative lending options that do not always hinge on a business’s credit score are emerging.
These lenders may look at factors like cash flow, online reviews, and even insurance and other operational aspects in their loan applications, offering further avenues for businesses to secure the capital they need.
It's worth noting, however, that while a loan with an EIN avoids a personal guarantee, maintaining good financial practices, building a strong business credit score, and ensuring timely debt repayments remain crucial for future financial opportunities.
Uplyft Capital
Experience financial solutions tailored for growth.
- Fast Approvals
- Competitive Rates
- Personalized Support
Building Business Credit With EIN
It's beneficial to start building business credit early. To do this, you’ll want to make sure you have at least one business credit card and at least five net 30 accounts.
Having these accounts established and reporting to the major business credit bureaus, like Dun & Bradstreet, Experian, and Equifax, will ensure that you qualify for better interest rates on business loans.
- Business Credit Cards: Apply for startup business credit cards using your EIN and pay bills on time.
- Establish Trade Lines: Work with net 30 vendors to create a track record of timely payments.
FAQs
How do I apply for a startup business loan using an EIN?
To get a business loan using an EIN, you typically need to approach a lender that offers loans to startups. Start with an online application, providing necessary details like your EIN, business type, and financial projections. Depending on the lender, further documentation, such as a business plan, might be required.
Are there specific lenders that specialize in EIN-only loans?
Yes, there are lenders that cater specifically to startups and newer businesses that may only have an EIN. Some of these lenders include Kabbage, OnDeck, PayPal Working Capital, Square Capital, and Fundera. They offer a variety of online business loans tailored to early-stage businesses.
What interest rates can I expect for an EIN-only business loan?
Interest rates can vary based on the lender and your business's perceived risk. Typically, online lenders may have higher interest rates compared to traditional banks due to the higher risks associated with lending to startups. Always review the terms and interest rates before finalizing any loan.
Do I need collateral for an EIN-only business loan?
Not always, but some lenders may require collateral, especially if you're seeking a larger loan amount. Collateral can be in the form of real estate, equipment, or inventory. However, many online lenders offer unsecured loans, which means no collateral is required but might come with higher interest rates.
Can I use a personal credit score to enhance my loan approval chances?
Yes, a business owner’s credit score can play a significant role, especially if you lack an established business credit history. Lenders may consider your personal creditworthiness as an indicator of your financial responsibility, potentially improving your chances of loan approval.
How long does it take to get approved for a startup business loan?
The approval time can vary. Some online lenders offer quick approval processes that can take just a few hours, while traditional banks might take weeks to review your application. Ensure you check the lender's estimated timeline before applying, especially if you need funds urgently.
What should I include in my business plan when applying for a loan?
A comprehensive business plan should detail your business's mission, target market, competition analysis, marketing and sales strategies, organizational structure, and financial projections. Including thorough research and clear, realistic projections can increase your chances of securing a loan.
