10 Types of Business Loans Every Entrepreneur Should Know About

If you’ve ever felt overwhelmed trying to figure out which loan is right for your business, you’re not alone. Every entrepreneur eventually faces the same question: how do I get funding without making the wrong move, or how to get the best funding without going through frustration.

The truth is, not all business loans are created equal. Some are designed to help you grow slowly and steadily. Others are built for speed, flexibility, or survival. And if you don’t understand the differences, it’s easy to choose based on speed or approval rate instead of what actually supports your long-term goals.

So let’s walk through ten types of business loans every entrepreneur should understand before signing on the dotted line. Whether you're just starting out or already scaling, this breakdown will help you make smarter funding decisions.

1. Business Line of Credit

A line of credit is one of the most flexible funding tools you can have. You’re approved for a certain limit, and you can borrow as needed, only paying interest on the amount you use. Once you repay it, that credit becomes available again, this type of line is called revolving, use as you need and pay as you use it. This is ideal for covering seasonal slowdowns, emergency repairs, or keeping operations moving while waiting for receivables.

2. SBA Loans

SBA loans are backed by the Small Business Administration, which means lenders can offer lower interest rates and longer terms with less risk. There are several types, like the SBA 7(a) for working capital or the 504 for real estate and equipment. These loans are perfect for businesses with solid financials looking for stable, affordable funding to grow, these loans a re used for equipment loans, working capital and buying commercial real estate.

3. Term Loans

This is a lump sum loan that’s repaid over a set period of time with fixed payments. Term loans can be short, mid, or long term, and they’re often used for specific projects like hiring a new team, expanding your location, or buying new technology. Think of this as a one-time boost to take your business to the next level. These loans are great if you are considering lower monthly payments and lower interest.

4. Unsecured Business Loans

These loans don’t require any collateral, which makes them easier to access if you don’t have equipment or property to pledge. They rely heavily on your revenue, credit score, and cash flow. While interest rates can be higher, they can be a fast way to get capital without putting your assets at risk. These loans are used when you need money fast and can be helpful when you find an opportunity to buy something at a discount or another deal that needs cash fast.

10 Types of Business Loans Every Entrepreneur Should Know About

5. Cash Loans and Advances

If your business does a high volume of daily credit card sales, a merchant cash advance might be an option. You get a lump sum now and repay it through a percentage of daily transactions. Cash loans are fast and flexible, but they tend to be expensive, so they’re best used for urgent needs with a clear payoff. These loans are suggested to be used only as a last resort, not as primary funding sources, because they are pricey.

6. Invoice Financing

Slow-paying customers shouldn’t slow down your business. With invoice financing, you can access capital by leveraging your unpaid invoices. A lender advances you most of the invoice amount and collects payment from your client later. This helps keep cash flowing while you wait for receivables to clear. Most of the time you receive 90% of your invoices in 24 hours and the rest once the invoice is clear.

7. Equipment Financing

Need to buy a new delivery van, industrial freezer, or medical scanner, or truck financing? Equipment financing allows you to fund the purchase and pay it off over time. The equipment itself acts as collateral, which makes these loans easier to qualify for and more affordable. Once you’ve paid it off, the equipment is fully yours, these loans a re great because some lenders can do 100% financing, and its really helpful to access the equipment faster.

8. Commercial Real Estate Loans

Whether you’re buying your first building or refinancing one you already own, commercial real estate loans offer long-term capital for property purchases. These loans are often used in tandem with SBA loans for favorable terms and lower down payments. Owning your space gives you equity and stability, two things that can transform your business, and help you build wealth over the long run.

9. Startup Loans

Securing business funding when you’re just starting out is no small task. But there are lenders who specialize in startup loans, especially for founders with strong credit and a solid business plan. These loans are usually smaller and more structured, giving new businesses the traction they need to get up and running.

10. Business Credit Cards

While they’re not technically loans, business credit cards can be a powerful financial tool. They help you manage short-term expenses, build business credit, and separate your personal and business finances. Look for cards with a 0% intro rate or rewards tied to your most common expenses to maximize value.

Choosing the Right Funding Option

The best loan for your business depends on more than just how fast you need money. It depends on your cash flow, growth strategy, risk tolerance, and long-term goals. Each of these funding types has its own pros and cons, and a good lending partner will help you think beyond approval and into outcomes.

At US Business Funding, we work with entrepreneurs at every stage. Whether you need a simple line of credit, an SBA loan, an unsecured business loan, or something more complex, our goal is to match you with the right lender, not just the fastest one.

We help business owners across the country access capital that supports their growth, not just their survival.

If you're exploring your options and want to talk to someone who actually understands your business, let’s connect. We’ll walk you through what’s available, what’s smart, and what’s sustainable, so you can move forward with confidence.