Guide · Credit
Business Line of Credit for Bad Credit
A business line of credit gives you a revolving pool of cash you can draw from, pay down, and draw again — perfect for uneven cash flow. But traditional bank lines want a 680+ FICO. If your credit is under 650, you still have real options: revenue-based lines from online lenders, secured lines backed by equipment or receivables, and MCA-style credit facilities that weight monthly deposits over personal FICO. Below is what actually funds with bad credit in 2026, what each option costs, and how to refinance into cheaper capital later.
Bad-credit line of credit options compared
| Option | FICO floor | Typical limit | Cost | Best for |
|---|---|---|---|---|
| Revenue-based LOC | 550+ | $5K–$150K | 20–60% APR | Consistent monthly revenue |
| Secured LOC (equipment / AR) | 600+ | $25K–$500K | 10–25% APR | Owners with collateral |
| Merchant cash advance (LOC-like) | 500+ | $5K–$250K | 1.20–1.50 factor | Card-heavy sales, fastest access |
| Business credit card (builder) | 580+ | $1K–$25K | 18–29% APR | Small recurring expenses, credit building |
| Bank / SBA LOC (reference) | 680+ | $25K–$500K | 8–15% APR | After credit is rebuilt |
How to qualify with bad credit
- • 3–6 months of clean bank statements ($10K+ monthly deposits, no NSFs, minimal negative days).
- • 6+ months in business (12+ preferred).
- • A business bank account separate from personal.
- • Collateral (equipment, receivables, or a personal guarantee) if you want higher limits.
- • Ability to explain past credit issues briefly in the application.
The path to a cheaper line
Treat your first bad-credit LOC as a bridge, not the destination. Make on-time payments for 6–12 months, keep utilization under 50%, and pay down personal credit card balances in parallel. Once your FICO clears 660–680, refinance into a bank or SBA line at half the rate. Many BizKred owners cut their cost from 40% APR to 12% APR on the second product.
See what you qualify for
Pre-qualifying with BizKred is a soft pull — it won't impact your credit score.
Frequently asked questions
Can I get a business line of credit with a 550 credit score?
Yes — revenue-based lines of credit and MCA-style products regularly fund at FICO 550+ if the business shows $10K+ in monthly deposits and clean bank statements (no NSFs, minimal negative days).
What's the minimum credit score for a business line of credit?
Traditional bank and SBA lines want 680+. Online revenue-based lenders start at 550. Merchant cash advances and secured products can go into the 500s.
Will bad credit mean a lower credit limit?
Usually yes. Bad-credit lines typically start at $5K–$25K and grow as you pay down the balance and rebuild credit. Expect the second draw to be larger than the first.
How much does a bad-credit business line of credit cost?
Rates run 20–60% APR (or 1.20–1.50 factor rates for MCA-style products) vs. 8–15% APR at a bank. You're paying for access and speed.
Does the business need its own credit?
Helpful but not required. Most bad-credit LOCs weigh personal FICO, bank statements, and time in business more than business credit (Paydex, Intelliscore). Building business credit alongside your LOC improves your next round.
How do I graduate to a cheaper line of credit?
Make on-time payments for 6–12 months, keep utilization under 50%, and refinance with a bank or SBA lender once personal FICO clears 660–680. Many owners cut their rate in half on the second product.