bed and breakfast

Best Bed and Breakfast Business Loans

Most bed and breakfast establishments are seasonal businesses, so it can be tricky to predict what your cash flow needs will be in the upcoming months. Taking out a loan can be a good way to ensure that your business has liquidity. On this page, our experts reveal the top small business loans available for bed and breakfast entrepreneurs.

Financially reviewed by Chip Stapleton, Finance Manager, on 9.23.2021

At a glance Lenders consider B&Bs a separate category from hotels, and thus the loan types suitable for the bed and breakfast business will differ slightly from those needed to start a hotel establishment. B&Bs are small owner-operated houses with a few rooms for guests. Usually, these are family-run businesses, where the hosts live in the same or closely adjacent building. This article talks about the best loan types and top lenders for B&Bs. Read on to learn more about how to choose and manage your small business loan as a bed and breakfast owner. 

Best Bed and Breakfast Business Loans - A Quick Overview

The table below illustrates the best bed and breakfast loans currently available on the market in 2022 and our recommended lenders.  

Recommended Lender

Financing Need

Best Loan Type

Loan Features 


Construction, renovation, and current expenses

Line of credit

  • Amount: Up to $20 million
  • Term: Seven years for working capital, 10 years for equipment, and 25 years for commercial real estate
  • Interest: Up to 2.75% + prime rate of 5% to 10%
  • Time to get the loan: Up to 4-8 weeks

Fora Financial

Building upkeep, renovations, staff salaries, various monthly expenses, security, taxes

Short-term loans

  • Amount: Up to 500,000
  • Term: Up to 15 months
  • Interest: No interest rate, instead offers one-time factor rate 
  • Time to get the loan: Up to 24 hours


Startup expenses

SBA microloan

  • Amount: Up to $50,000
  • Term: Varying terms, based on business credibility
  • Interest: 8% - 13%
  • Time to get the loan: Up to 4-8 weeks


Spendings during the off-season

Seasonal B&B loan

  • Amount: Up to $150,000
  • Term: 6-12 months
  • Interest: As low as 4.8%
  • Time to get the loan: A few days to a week

National Funding

Renovation, equipment purchasing, and current spendings

B&B term loan

  • Amount: $5,000 to $50,000 (with the recommended lender)
  • Term: Medium 1-5 years, short up to 18 months
  • Interest: 10-30%, plus a 1% origination fee (with the recommended lender)
  • Time to get the loan: 1-7 days


Incremental operational expenses

Business line of credit

  • Amount: $6,000 to $100,000 (with the recommended lender)
  • Term: Draw time of 12 months (with the recommended lender)
  • Interest: 11% to 57.9% (with the recommended lender)
  • Time to get the loan: 26 hours (with the recommended lender)

Bed and Breakfast Business Loans Explained

Now, let's have a more detailed look at the loan types and recommended lenders outlined in the table above. 

1. Fundbox - Best for Line of Credit

SBA loans offer high capital amounts with low rates. It can be a bit difficult to qualify for an SBA loan and it often takes about two months to get approval. 

The Small Business Administration authority ensures up to 85% guarantee on the amount, so the lenders experience less risk. You will, however, need to ensure that your business has enough credibility to be eligible for this loan type. 

Your B&B business could potentially use this loan type to buy real estate, undertake renovations, or deal with any construction needs your business may have (SBA 504/CDC). You can also use an SBA loan to obtain working capital (SBA 7(a)). 

Fundbox has years of experience with SBA and small business funding loans in general.  Fundbox has a simple automated process available on its platform and minimal documentation is generally required. This lender also boasts short application processes.  

Read the full Fundbox review for more details.

2. Fora Financial - Best for Short-Term Loans

It is important for a bed and breakfast business to remain top-notch in order to keep attracting customers. However, renovations, construction, and other related costs can run very high. Fortunately, short-term loans can help take care of such expenses and take the business to the next level.

Fora Financial gives businesses the chance to make short-term loans that have flexible payment terms. Quick repayment of the loans is encouraged and businesses that do so get discounts - up to 10c to the dollar off.

Fora Financial was founded in 2008 and has grown to become a trusted and recommended lender to businesses in many different industries. They offer some of the most flexible loan amounts, terms, and requirements in the lending industry. The company also makes applying as simple as possible and available online for a faster process.

Read the full Fora Financial review for more details.

3. Fundera - Best for Microloans

Microloans are the smaller versions of SBA loans. If your business is new and has limited credit history, an SBA loan may be the best option for you. Although an SBA loan provides smaller loan amounts, this loan type will get you started and will let you pay back your loan faster.

This loan type may be a good choice for startup B&Bs and smaller establishments with fewer rooms. It can help you get on your feet fast before and later down the track you can qualify for more significant amounts.

Many lenders may be hesitant to lend to new businesses, however, Fundera is generally happy to work with startups. It's easy to start with this company, as the information they provide on their loan types is transparent and straightforward.

Read the full Fundera review for more details.  

4. BlueVine - Best for Seasonal Loans

B&Bs depend on an influx of visitors in the high seasons. Relying on the capital you earn from these seasons may not always be a viable solution. If you don’t have enough guests during certain months, a short-term seasonal loan may be a great solution. 

The key is to apply for a loan directly after high-season, so that you can pay the loan back before your account is drained.

If you need liquid cash during the off-season, a short-term loan can help you stay afloat until the next high-season. 

BlueVine's short-term loans are ideal for seasonal businesses. In addition to their competitive rates, they also offer swift money disbursement. If you have a monthly turnover of at least $10,000, have been around for six months, and record a credit score of at least 600, this company is ideal.

Read the full BlueVine review for more details. 

5. National Funding - Best for Term Loans

Term loans are a good alternative if you're not able to qualify for an SBA loan. Lenders will typically provide a lump sum to what they deem to be riskier businesses. That's why the rates are much higher when compared to government-backed SBA loans. With a term loan you can choose to go with a medium- or short-term option.  

These loans are easier to qualify for than SBA loans. Term loans are excellent cash boosts for equipment purchases, facility improvements, and other expenses.

National Funding has been around since 1999 and has helped over 40,000 US businesses, giving out $2.5 billion. National Funding has an excellent track record of solid partnership with its clients. You can generally get the loan in a day, even if you don’t have a great credit track record.

Read the full National Funding review for more details. 

6. OnDeck - Best for Business Line of Credit

A business line of credit is excellent, as you can draw the needed amount when necessary, and will only need to pay the interest percentage on what you owe. This is one of the best loan solutions for improving working capital.

If you're experiencing issues with current liquid capital, or aren't able to handle seasonal worker payrolls, have low margins, or need a quick repair, this type of loan can help you out.

OnDeck is one of the best commercial mortgage lenders, the company also has a solid track record working with small businesses. OnDeck is typically willing to assist small businesses that are having temporary cash flow trouble.

Read the full OnDeck review for more details. 

Recommended Reading: Best Hotel Financing Loans for 2022

How Much Does it Cost to Open a Bed and Breakfast Business?

It’s important to have a solid business plan before you make any decisions about which loan to apply for.

Below is the breakdown of the general spending categories you may encounter when starting a B&B business:

  • Licenses: Depending on your location, you may need a few license types and permits. Renovations, building, food, and drink permits are only a few of the possible permits you may require. The costs for these may vary, ranging from a few hundred to a few thousands of dollars.
  • Exterior and interior renovations (~$20,000 minimum): This category accounts for all the family house improvements and/or modifications you may need. You may also need to account for construction costs and design improvements. 
  • Bedding (~$500 per room) and kitchen equipment ($500-$1,000): New and clean bed linens and being served from a clean kitchen is an essential part of any successful B&B business. 
  • Food (costs depend on how many meals you serve and what you aim for): The best food for a B&B is local and authentic, made by the owner or a local chef. While you can serve anything, it’s best to stick to what you know.  
  • Security ($1,000): You will likely need some form of security system to secure your B&B. You may also wish to hire a security desk person for a more "personal touch."
  • Business and other business expenses (a few thousand dollars): Marketing is essential if you want people to learn about your establishment. Sure, finding a B&B the old way (by bumping into it on the street of a new town) sounds romantic, but nowadays, your audience is primarily online.  

While the initial spendings might be around $20,000 to $40,000, you should also account for renovations and modernization over the years. 

Recommended Reading: Best Hospitality Business Loans in 2022

Bed and Breakfast

How to Choose the Best Bed and Breakfast Business Loans

If you want to get into a loan agreement to ease your business's financial situation, you should try to develop a basic understanding of finances. As a savvy business owner, you might already know a few things about accounting and cash flows. Nevertheless, learning more about this topic can be helpful. You may also wish to refer to an accountant for assistance. 

Find out as much as you can about your credit score and accounts. And, perhaps most importantly, do your research before jumping in and make sure that you have a repayment plan.

Recommended Reading: Best Spa Business Loans

See Our Additional Guides on Industry-Specific Loans

    Bottom Line

    Operating a B&B might be your ultimate goal, yet starting a business from scratch or developing an existing B&B business can be a daunting task. Luckily, there are many loan options available on the market to help ease some of the pressure and to get you started on the right path. In this article, we have outlined the top bed and breakfast business loans and recommended lenders. Now all you need to do is simply decide which loan type and lender best meets the needs of your B&B establishment.