Can You Get a Business Loan After Bankruptcy?

How funders view a past bankruptcy

A bankruptcy signals past repayment trouble, so funders look for evidence that things changed. The more time that has passed, the less it weighs.

A bankruptcy can stay on a credit report for years, and the exact period depends on the type filed. Funders focus on what has happened since: steady deposits, on-time payments and healthy balances. Some funders will not consider recent filings at all. Others treat it as one factor next to current revenue.

Check your credit report for accuracy. Our types of business bankruptcy page explains the differences.

Personal versus business bankruptcy

Which filing it was matters. A personal bankruptcy hits your personal credit, while a business filing affects the company and sometimes its owners.

Because many small business products rely on the owner's credit and a personal guarantee, a personal bankruptcy often affects approval more than a prior business filing. If your earlier company closed and you started a new one, funders still review your personal history and the new company's time in business.

What helps your file

Strong, consistent bank deposits, on-time payments since discharge and an explanation of what changed give the file credibility.

• At least several months of clean business bank statements
• No new late payments or overdrafts
• Revenue that has grown or held steady
• A brief written explanation of the cause and what you changed
• Rebuilt credit, even with small accounts paid on time

See ways to boost your credit score for rebuilding steps.

What to expect on cost and terms

Expect higher pricing, smaller amounts, shorter terms and possibly more collateral or a personal guarantee. Compare total cost before accepting.

Funders price in risk, so offers after bankruptcy can cost more than usual. That makes payback math more important. In an illustrative example, if funding costs $3,000 extra and the project earns $10,000 of profit, the cost may be reasonable. If it earns $2,000, skip it. Review our total cost guide.

Options that weigh revenue over history

Working capital, revenue-based financing and equipment financing look closely at current sales or the asset, so they can be easier routes than a bank loan.

Banks and SBA loans lean on credit history and may be out of reach for some time. Products like working capital and revenue-based financing weigh your recent revenue. For a specific purchase, equipment financing is secured by the equipment itself. None of these is guaranteed, and each funder decides on its own.

Rebuilding while you wait

If funding is not available yet, use the time to rebuild so the next application is stronger.

Open a business bank account if you do not have one, and run all sales through it. Pay every bill on time. Consider a small secured credit product that reports to the bureaus. Reduce card balances. After six to twelve months of clean activity, your file looks very different. Keep a copy of your discharge paperwork in case a funder asks for it.

Questions to ask a funder

Ask direct questions up front so you do not waste time on products that exclude recent bankruptcy.

Ask how long after discharge the funder will consider a file, whether a personal guarantee is required, and what the total repayment would be in dollars. Request the answers in writing. If the funder cannot answer plainly, move on. A clear answer, even a no, saves you time and protects your credit from unnecessary inquiries.

Where ROI Funder fits

ROI Funder considers 500+ FICO, 6+ months in business and $20,000+ monthly revenue. Applying uses a soft credit pull, so you can see options without a score impact.

If your credit has recovered and your revenue is steady, apply and see what the funders in our network offer. We show true cost, payback period and monthly-equivalent payments before you sign. Recent bankruptcy may limit options, and approval is never assured. Start with a short application or read getting a business loan with bad credit.