U.S. Bank Business Loans: Worth It This Year?

(June 2024)

U.S. Bank Business Loans- Worth It This Year?

In This Article

Our Verdict

Man with money at the ATM

US Bank is ranked 5th largest bank by assets in the United States with over 2000 branches. Founded in 1929 and headquartered at 800 Nicollet Mall in Minneapolis, Minnesota, U.S. Bank spreads to other 27 states in which it has over 4,500 ATM machines.

Ohio

Oregon

South Carolina

South Dakota

Tennessee

Texas

Utah

California

Washington

Wisconsin

Wyoming

Arizona

Arkansas

Colorado

Idaho

Illinois

Indiana

Iowa

Kansas

Kentucky

Missouri

Montana

Nebraska

Nevada

New Mexico

North Carolina

North Dakota

With U.S Bank, you have access to different kinds of financing options—like lines of credit, term loans, equipment financing, SBA loans and others—to new businesses and established companies. You can also get an SBA loan amount of up to $12.375 million with a favorable interest rate. Once your year of operation in business is up to 1 year, the U.S. Bank guarantees quick loan processing with a few documents. Most of its business loan products have an expiration period that is up to 25 years. For more information about the bank, visit https://onlinebanking.usbank.com/auth/login/?channel=mobileweb

Pros

  • Variety of loan products
  • Suitability for SBA borrowers
  • Competitiveness of APRs
  • Availability of online loan application
  • Availability of numerous branches
  • Branch accessibility in 28 states
  • Long-term loan products

Cons

  • Zero transparency in terms and fees
  • Confusion in qualifications criteria
  • Presence available in 28 states
  • No Provision for professionals
  • Paperwork for new businesses may be hectic.
  • Zero incentives

Who This Product Is Best For

People in the US Bank

Choose U.S. Bank if you are a business owner who:

  • Has solid creditworthiness and wants to maximize its friendly APRs
  • Desires encounter with financing in person—whereby you meet a banker to discuss personal terms.
  • Needs a certified SBA lender
  • Lives in any of the 28 states that the U.S. Bank covers
  • Has a business that has been in operation for more than one year
  • Wants a lender with multiple lending options
  • Has a U.S. Bank checking account

Who This Product Isn't Right For

You may not experience the goodness of U.S. Bank loan products if you are a business owner who:

  • Prefers online lenders to traditional banks
  • Wants fast approvals and quick funding on the amount that’s above $250,000
  • Doesn’t have a high credit score or high revenue on an annual basis
  • Wants a lender with a wide range of availability
  • Has less than one year of history as a business owner
  • Doesn’t live in Upper Midwest or West Coast part of the country
  • Needs a bank that offers promotions and rewards

What This Product Offers

U.S. Bank

Business term loans: These loans are paid to the borrower as a lump sum amount which is paid back monthly in a fixed amount.

Quick loan: This loan serves you the opportunity to tap into a quick fund for any purpose. You can use it to secure equipment, and vehicles, or as cash flow to boost your business.

SBA loans: US Bank is preferred SBA lender. SBA loans generally give lower interest rates and term flexibility.

Commercial real estate: This loan encourages business accumulation and business growth.

Business line of credit: This loan offers spending money for occasional expenditures.

Equipment financing: This loan enables you to get the right tools and equipment your

Product Details

Business term loan

U.S. Bank offers 2 types of term loans—according to your risk level—which are secured and unsecured loans. Its secured business term loan is similar to equipment financing. Also, be aware that with a secured term loan, failure to pay back puts you at risk of losing your equipment.

Loan amount: $5000 to $250,000 for a secured loan while unsecured loan ranges from $5000 to $50,000.

APR: 8.49% for a secured loan and 9.49% for an unsecured loan.

Terms: Secured loan attracts 24 to 84 months for repayment duration. Unsecured loans are 24 to 48 months.

Repayment schedule: Automatic payment setup from your US Bank checking account.

Fees: No fee is applicable.

Quick loan

U.S Bank’s quick loan, depending on your eligibility, can come as a secured or unsecured loan. The loan rate is competitive and available as SBA financing. Another good thing, you can apply for it online.

Loan amount: Begins from $5,000 to $250,000.

APR: As low as 7.99%

Term: Expiration period is up to 7 years

Fees: No fee is applicable

SBA loans

As one of the best SBA lenders to bet on, U.S. Bank offers three types of SBA financing options which are:

  • SBA 504 loan. The loan amount is $12,375,000 and the repayment term is up to 300 months.
  • SBA 7(a) loans. The amount is $5,000,000 to $7,000,000 for a 25 years term.
  • Working capital. The amount of loan offered is not disclosed but the duration may last up to 7 years.

Commercial real estate

Most banks and online lenders only consider commercial real estate as part of an SBA loan. But US Bank pulls up the gear by adding two other financing programs to commercial real estate which are the acquisition of property for business expansion and property acquisition.

Loan amount: Can reach up to $10,000,000.

APR: Begins at 6.99%.

Term: 24 to 300 months.

Repayment schedule: Monthly.

Fees: No application fee.

Business lines of credit

U.S. Bank named it “Cash Flow Manager” and it is very similar to the U.S. Bank business term loan in the sense that it can be secured or unsecured. Just as its name suggests, it is a revolving credit line that helps you to maintain the cash flow needed to control your business. Know that you are only entitled to the maximum amount of $100,000 if you choose the unsecured lines but US Bank secured lines are $250,000.

Amount: $10,000 to $250,000 on a secured loan and $10,000 to $100,000 on an unsecured loan.

APR: 9.99%

Term: Not specification

Repayment schedule: Depends on when the draw period ends

Fees: $150 though it can be removed for credit lines not more than $50,000.

Equipment financing

US Bank has limited information on its equipment financing scheme but it has a “quick loan” which you can still use to get financial assistance of $5,000–$100,000.

Amount: Equipment loan up to $100,000

APR: As low as 7.49%.

Term: Anywhere between 24 to 84 weeks.

Repayment schedule: Monthly.

Fees: No applicable fee.

Where This Product Stands Out

Competitive APRs

U.S. Bank term loans are pegged at a lower rate of 7.99% and lines of credit can be as low as 1.99%.

Digital application

Unlike most traditional banks that require a physical application for most of their lending options, U.S. Bank not only settles for manual applications for its loan options but also allows online applications for selected term loans and lines of credit. Nowadays,  US Bank has taken a giant stride to invest in digital tools and services for better internet and mobile banking.

Different kinds of lending options

US Bank is SBA’s preferred lender. It also provides term loans (secured and unsecured), credit lines (secured and unsecured), and equipment financing along with other forms of financing—like commercial real estate and medical practice loans.

Numerous branches across service states

You can access several U.S. Bank locations if you reside in any of the states that the bank serves. In California, you have access to 557 branches, Minnesota 442 branches, and Missouri 323 branches. This lender also maintains more than 100 branches in states like Illinois, Ohio, Oregon, Wisconsin, and Colorado.

Wide range of business checking accounts

As a prospective borrower of U.S Bank, you need a business checking account to receive funds and to pay back loans. And in respect to this, you have numerous types of checking accounts to choose from. For instance, U.S Bank offers a free checking account which it calls Silver Business Checking and an interest-bearing checking account known as Gold Business Checking.

Where This Product Falls Short

Strictly limited in state territories

Financing products are only available to lenders in 26 states.

Inadequate details on qualifications

Before applying, you may not be able to ascertain your chance of getting approved. In fact, US Bank follows the footsteps of most traditional banks by not declaring a required credit score for any of the loans it offers.

Interest rate not fully revealed online

Unless applying, you cannot get sufficient information by surfing the internet to learn about US Bank’s charged rates on its loan products.

Not a good option if you have a low credit score

You may be facing difficulties if your FICO Score is below 675. However, the bank doesn’t mark out any borderline credit score on its loan products but as a traditional mortar and brick bank, you are expected to have a higher credit score.

You need a U.S. Bank checking account

Before you can qualify for any of US Bank’s lending options, you need to open a checking account with the bank. This account allows you to receive lending funds and also allows U.S. Bank to deduct your payment according to your loan term.

No promotions or rewards

Although the U.S. Bank charges no monthly fee or origination fee, the bank doesn’t offer any promotions or rewards programs on any of its loan products or checking accounts.

How to Qualify for This Product

US Bank is not specific about qualification standards for its loan products, it only recommends you apply online or stage a meeting with a business banker to fill out an application. Notwithstanding, here are a few recommendations on what to have before you can stand a chance to qualify for US Bank business loans.

Time in business

Most traditional banks require 2 years in business operation. Though you need to arrange a meeting with a business banker,  we recommend companies to have been involved in business activities for 6 months.

Personal credit score

You need a credit score of 700 to 850 to boost your eligibility.

Annual revenue

US Bank doesn’t uphold the necessity of meeting any required revenue before you can be eligible. However, you need to submit proof of income and proof of identity.

Business checking account

U.S Bank requires you open a business checking account with the bank before you can qualify for its business lending options

Proof of collateral

To qualify for U.S Bank secured loans, you need worthy collateral. This can be a car, equipment, company building, or ownership certificate. This is largely based on the amount you are taking out as a loan. In fact, U.S Bank states on its website that it will file a UCC lien which takes all your business assets as collateral.

How to Apply for This Product

A US Bank representative would not reveal any certain requirements the company demanded on any of its lending products. They would rather tell you your condition is the major determining factor in this and that a US Bank business banker can educate you on what documents you need to apply. However, based on a general notion of traditional bank loans, prepare to tender the following paperwork for the majority of the business loan application, in addition to other lender-specific requirements:

  • Your personal and business tax returns
  • Details of your total annual revenue
  • Tax ID number for your business
  • Business financial documents, and
  • Article of incorporation
  • Franchise agreements
  • Permits certificate
  • Business plan and loan application.

Alternatives to This Product

Bank of America

Bank of America offers as many loan products as US Bank does. Being a larger company than US Bank, Bank of America has a presence in all 50 states in the country. However, US Bank offers a higher loan amount for commercial real estate than Bank of America. You have access to rewards and promotions including professional loans such as dentist loans, medical loans, and veterinarian loans. Bank of America doesn’t have quick funding like U.S Bank quick loans, but if you want Bank that has a presence across the country, you can’t look away from Bank of America.

OnDeck

OnDeck can approve you with a fair credit score compared with US Bank’s stricter credit score. Also, has a wider availability with a strong online presence than US Bank. Loan approval is faster but not without a higher rate. However, OnDeck is an online lender and it only offers term loans and business lines of credit, you can consider it if you can’t qualify for standard bank loans. Note that OnDeck payment terms may require frequent payments within a short period.

America Express

America Express offers business lines of credit from $2,000 to $250,000 with expiration terms ranging from 6 months to 18 months. To qualify, you don’t need a higher FICO Score nor do you have to pay origination fees, monthly maintenance, or prepayment fees. Nevertheless, you need an established business with a monthly revenue of around $3,000. Also, the bank has a short term for repayment. However, if you need a bank that offers quick funding with low qualification requirements, choose America Express.

Customer Reviews

U.S. Bank has an excellent rating on the Better Business Bureau’s website (BBB). A few of the negative reviews the company receives lately are characterized by delayed response, overdraft fees, and strict eligibility. Whereas, on the positive side, US Bank receives praise as it is an answer to borrowers who dream of getting a 7 figured loan amount in addition to its financial stability and accessibility.

Methodology

We reviewed *this product* based on 20 data points in the categories of loan details, loan costs, eligibility and accessibility, customer experience and the application process. We rated *this product* based on the weighting assigned to each category:

  • Loan cost: 35%
  • Loan details: 25%
  • Customer experience: 20%
  • Eligibility and accessibility: 10%
  • Application process: 10%

Within each major category, we also considered several characteristics, including available loan amounts, repayment terms and

applicable fees. We also looked at minimum credit scores and time in business requirements and the geographic availability of the lender. Finally, we evaluated *this product* customer support tools, borrower perks and features that simplify the borrowing process—like online applications, prequalification options and mobile apps.

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