How Long Does It Take to Get a Commercial Loan?
Quick Answer
2–12 weeks from application to funding. SBA loans take the longest at 6–12 weeks, while online lenders can fund in as little as 1–2 weeks.
Typical Duration
Quick Answer
Getting a commercial loan takes 2–12 weeks from application to funding. The timeline depends heavily on the lender type, loan size, and complexity of the deal. Traditional bank loans typically close in 4–8 weeks, SBA loans take 6–12 weeks, and online or alternative lenders can fund in 1–3 weeks.
Timeline by Loan Type
| Loan Type | Application to Approval | Approval to Funding | Total Timeline |
|---|---|---|---|
| Online / alternative lender | 1 – 3 days | 3 – 10 days | 1 – 2 weeks |
| Traditional bank (term loan) | 2 – 4 weeks | 1 – 3 weeks | 4 – 8 weeks |
| Commercial real estate loan | 3 – 6 weeks | 2 – 4 weeks | 5 – 10 weeks |
| SBA 7(a) loan | 3 – 6 weeks | 2 – 6 weeks | 6 – 12 weeks |
| SBA 504 loan | 4 – 8 weeks | 4 – 8 weeks | 8 – 16 weeks |
| Commercial construction loan | 4 – 8 weeks | 2 – 4 weeks | 6 – 12 weeks |
| Equipment financing | 1 – 5 days | 3 – 14 days | 1 – 3 weeks |
| Business line of credit | 1 – 7 days | 1 – 14 days | 1 – 3 weeks |
Steps in the Commercial Loan Process
1. Pre-Qualification (1–5 days)
The lender reviews basic financial information — revenue, credit score, time in business, and loan purpose — to determine whether you meet preliminary requirements. This step is often completed during an initial phone call or online application.
2. Full Application (3–10 days)
Submitting a complete application package typically includes business financial statements, tax returns (2–3 years), a business plan, personal financial statements of guarantors, and details about collateral. Gathering these documents is often the most time-consuming part for borrowers.
3. Underwriting (1–6 weeks)
The lender's underwriting team analyzes your financials, verifies information, orders appraisals (for real estate loans), and assesses risk. This is the longest phase and where most delays occur. SBA loans have an additional layer of government review.
4. Approval and Term Sheet (1–5 days)
Once underwriting is complete, the lender issues a commitment letter or term sheet outlining the loan amount, interest rate, repayment terms, fees, and conditions. Borrowers typically have a window to review and negotiate terms.
5. Closing and Funding (3–14 days)
Legal documents are prepared, reviewed, and signed. For real estate transactions, a title search and closing are required. Funds are typically disbursed within 1–3 business days after closing.
Factors That Speed Up or Slow Down Approval
| Factor | Speeds Up | Slows Down |
|---|---|---|
| Credit score | 700+ personal, strong business credit | Below 650, limited credit history |
| Financial documents | Organized, complete package | Missing or outdated records |
| Collateral | Clear title, readily appraised assets | Complex assets, environmental issues |
| Loan size | Under $500K (simpler underwriting) | Over $5M (additional review layers) |
| Business history | 3+ years with consistent revenue | Startup or less than 2 years |
| Lender type | Online lenders, community banks | Large national banks, SBA programs |
| Property type | Standard commercial (office, retail) | Specialty (hospitality, healthcare) |
Lender Comparison
| Lender Type | Best For | Typical Rates | Speed |
|---|---|---|---|
| Traditional banks | Established businesses, large loans | 6% – 10% | 4 – 8 weeks |
| Credit unions | Small businesses, member benefits | 5.5% – 9% | 3 – 6 weeks |
| SBA lenders | Startups, lower down payments | 6% – 9.5% | 6 – 12 weeks |
| Online lenders | Fast funding, less documentation | 8% – 30% | 1 – 2 weeks |
| CDFI lenders | Underserved communities | 5% – 10% | 4 – 8 weeks |
| Hard money lenders | Bridge loans, quick closings | 10% – 18% | 1 – 3 weeks |
Tips for a Faster Closing
- Prepare documents in advance: Have 2–3 years of tax returns, financial statements, and a current balance sheet ready before applying.
- Maintain clean financials: Resolve any outstanding tax liens, judgments, or credit disputes before starting the application.
- Choose the right lender: Match your loan needs to a lender that specializes in your industry or loan type.
- Respond promptly: Delays in providing additional documentation or answering lender questions are the most common cause of extended timelines.
- Work with a loan broker: Commercial loan brokers can match you with lenders and streamline the application process, potentially saving 1–2 weeks.