acquisition loans

Best Business Acquisition Loans in 2022

You might use a business acquisition loan to fund a startup, buy into a franchise, or buy a rival company outright. The challenge comes in knowing where to find this type of borrowing and how to use it effectively. Read on to discover how business acquisition loans work, the pros and cons, and costs.

Written by Anthony Edmundson, updated on 10/20/2021
Financially reviewed by Gordon Scott 7/21/21
At a glance  A business acquisition loan may enable you to more effectively traverse the demanding and often costly undertaking of purchasing a small business. Although there is no one particular loan created for this end, there are many loan types for small businesses. On this page, our experts outline all you need to know about this type of borrowing and the top lenders.   

Best Business Acquisition Loans in 2022

We’ve included a mixture of specialist acquisition lenders as well as some all-purpose options in our list below. Most platforms can be quite flexible in what you use your funding for but startup loans might have stricter criteria.

1. Credibly - Best for Equipment Financing

Credibly is a direct lender that focuses on those with bad credit, welcoming applications from anyone with scores of 500 and above. The platform was founded in 2010 and now works with more than 325 industries when sourcing acquisition loans. 

  • Tailored business acquisition loans
  • Access to a personal loan advisor
  • Bad credit welcome
  • Fast turnaround on loans
  • An origination fee will be charged
  • Low borrowing limits

Credibly Features

Credibly actually offers highly tailored business acquisition loans over the long term. The figures in our table above represent a very broad range of possible terms and you may be offered something different to this. Each application will be reviewed by your personal loan advisor and many factors go into determining your final offer. 

Our thoughts

If you’re looking for a long-term loan, and aren’t in a rush to apply, then Credibly is a good place to start. Its customer service is top-notch and having access to a personal loan advisor throughout the process makes everything that much easier. Read more in the full Credibly review.

2. Lendio - Best for Merchant Cash Advance

Lendio is one of the largest loan marketplaces in the country. It’s disbursed more than $12 billion in funding since it was founded in 2011 and has partnered with more than 75 lenders. It’s one of the few alternative lenders that offers specific business acquisition loans. 

  • Low starting rates
  • Tailored business acquisition loans on offer
  • Generous borrowing limits
  • Applications open to all
  • Long funding time
  • A lot of documentation is required

Lendio Features

Lendio offers excellent rates, starting at just 5.5%, and a generous borrowing limit of up to $5 million. Terms are pretty good too and you can repay your loan between a 10 and 25 year period. Best of all, there are no minimum requirements to apply other than needing to submit a business plan, meaning all applicants are welcome. 

Our thoughts

It’s easy to see why Lendio is our top pick as it’s perfect for even the smallest of businesses looking to apply for an acquisition loan. There’s no hard pull to your credit rating for taking a look at offers, and it’s a good way to see the kind of deals you can get. Read more in the full Lendio review.

3. Ondeck - Best for Line of Credit

OnDeck doesn’t offer a specific business acquisition loan, but it's term loans can be used for any purpose. The platform is a direct lender that offers discounts to repeat customers.

  • Very fast funding
  • No restrictions on loan use
  • Lenient eligibility criteria
  • No additional fees
  • High interest rates
  • Short repayment terms

OnDeck Features

All of OnDeck’s term loans are intended as short-term products that can be funded quickly, usually within 24 hours. It’s perfect for small businesses that need to make a fast acquisition where time is of the essence. However, this convenience comes at the cost of higher interest rates. 

Our thoughts

While interest rates might be a little high, OnDeck should be your go-to lender in a pinch. If you need to purchase a business quickly or have an emergency that needs funding there’s a good chance you’ll be accepted. Read more in the full OnDeck review.

4. LendingClub - Best for Term Loans

LendingClub specializes in low-dollar, short-term loans. Eligibility criteria are quite lenient and it makes the ideal choice for borrowers that need fast funding to buy into a franchise business, or are founding a startup, even though loans can go up to $500,00

  • Great for startups and franchise acquisitions
  • Simple application process
  • Fast funding times
  • No income requirements needed
  • Customers with less than $50,000 in revenue or 12 months in business will not qualify for loans.
  • An origination fee will be charged

LendingClub Features

LendingClub is friendly to new businesses and all applications are welcome as long as you have a credit score between 580-669. The platform can usually arrange funding within 48 hours of being approved. 

Our thoughts

If you’re looking for a way to fund a new startup, or just need a quick injection of cash, you needn’t look any further than LendingClub. A quick call to the friendly customer service team will help you understand what options are open to you and how best to use your loan. Read more in the full LendingClub review.

5. SmartBiz - Best for SBA Loans

SmartBiz is an online platform that connects borrowers to some of the biggest banks across the country. It’s usually able to secure pretty good rates but you’ll find eligibility criteria a little stricter here. 

  • Connections to dozens of banks
  • Low interest rates
  • Easy-to-follow application process
  • Great customer service
  • High minimum qualification criteria
  • Limited customer service options

SmartBiz Features

When applying at SmartBiz you’ll be offered a long-term bank loan. However, you can use this for business acquisition purposes if you wish. You’ll need a good credit rating as a minimum and need to have been in business for two years. Rates start at a very respectable 6.99% and terms extend to five years. 

Our thoughts

It’s a little harder to get a loan here than other providers on our list, but we think it’s definitely worth it if you have good credit. The platform is reliable, efficient, and offers solid rates and terms. Read more in the full SmartBiz review.

Key Features of The Best Small Business Acquisition Loans


Max/Min Loan

Loan Rates

Special Requirements

Get a loan


Credibly review

$5,000 - $400,000

9.99% - 45%

A minimum credit score of 500

Minimum monthly revenue of $15,000



Lendio Review

$5,000 - $5 million

Starting from 5.5%

You must present a business plan

Funding will usually take around 30 days on average


OnDeck review

$5,000 - $250,000

From 35%

Credit score of 600

Minimum annual revenue  of $100,000

Ondeck specializes in fast funding and you could have your cash within 24 hours


LendingClub review

$5,000 - 500,000


Fair credit score between  580-669

You can usually get funded within 48 hours


SmartBiz review

$30,000  - $500,000

Starting from 6.99%

A minimum credit score of 660

Minimum of two years in business

Funding usually received within one week

What Is a Business Acquisition Loan?

A business acquisition loan is a type of funding that’s primarily used to purchase another existing business. However, it can also be used to buy out your partners in your current business, open up a franchise, or even fund a brand new startup. These types of purchases typically require large capital expenditure upfront which is why many turn to loans to fund the acquisition.   

How to Get a Loan to Buy a Business

You’ll generally find that applying for a business acquisition loan requires a more in-depth review by the lender and for you to provide more documentation. This isn’t always the case though, and as we’ve seen from our list of providers, there are those that will allow you to use your funding for any purpose that you’d like. 

When you apply you’ll of course be asked why you want the funding and may need to provide the following:

  • Your business plan - This will show the lender how you intend to make the acquisition profitable
  • Your business debt schedule - If you’re already carrying too much debt you may be rejected
  • Business tax returns - Usually covering the previous two years
  • Company financial statements - This will show your profitability and give the lender an idea of whether you can repay the loan
  • Evidence of your credit score - This will usually confirm if you meet the minimum requirements
  • A signed letter of intent - This letter signifies your intention to buy a specific business or other acquisition. It should stipulate that this will be dependent on receiving the loan

How to Value a Business for Acquisition 

Before deciding to acquire any business, whatever the size, there are always going to be many stages of due diligence to carry out. This will help to confirm whether or not the business is sound and how beneficial the acquisition will be. There are three key areas that need to be scrutinized.

  • Balance sheet - The first, and most important, is the balance sheet. This will give a fair and objective view of how strong the business is and reveal any hidden debts or other undisclosed financial commitments
  • Business tax returns - Two to three years of tax returns will also be required to give an overall picture of how the business to be acquired has fared in the recent past. Ideally, these will show a consistent level of income over the years submitted
  • Profit margin - Even for businesses with a very impressive annual turnover, it’s the profit margin that is the most significant figure. Naturally, the higher it is the better the prospects are after the acquisition

Business Acquisition Loans Pros and Cons


  • An immediate boost to business - When you acquire another organization or expand your own operations, you open up an instant second stream of revenue. Lots of businesses use this as an opportunity to double output and find profits from the new venture can easily cover the repayments
  • Turnaround times are generally fast - In many cases, you can get funding within a week of submitting your application. This all depends on individual lenders of course, but as long as you have the correct documentation ready the process is swift
  • Low rates - You’ll often find great deals on rates when you’re taking out a type of long-term borrowing like this, especially if you have a good credit score
  • Fixed payments - The vast majority of business acquisition loans have fixed payments. This makes it easy to slot into your monthly budget and do some long term financial planning


  • Reliance on cash flow - Most business acquisition loans are on the high-value end and lenders will want to know you have the ability to pay it back. This means your cash flow is going to have a big influence on how much you can actually borrow. If your business has low liquidity you might be in trouble
  • Additional stipulations - Some acquisition loans have additional contract stipulations. For example, if you use an SBA loan to finance a business purchase you must ensure the previous owner retains no stake. Plus, you must prove you’ve exhausted other financing avenues before applying. Make sure to check the contract and terms and conditions carefully

See Our Additional Guides on Business Loan Types

Final Thoughts

Deciding to acquire another business, buy into a franchise, or expand your operations is a big decision. However, a targeted purchase can be a huge boon for growth and can add multiple new revenue streams to your operations. As long as you have a solid business plan and a clear idea of which business you’d like to acquire, it’s easier than ever to get a loan. 

In most cases, lenders will let you submit an application for pre-approval and your credit score won’t take a hit. It’s risk-free to browse options, and in many cases, you could be funded that very week. So, why not take a look at some of the great lenders out there?