The best term loan for a restaurant depends on what you are financing and how long it will last. To remodel, replace the hood, buy a walk-in cooler or open a second location, a loan with a fixed term lets you plan the payment. Merchant Fund Express is our recommended funder if you need a decision in hours: it reviews sales and deposits and considers credit from FICO 500+. OnDeck offers terms up to 24 months, National Funding finances equipment over 2 to 5 years, and an SBA 7(a) loan is usually the cheapest if you qualify.
A term loan is not the same as a line of credit or a cash advance. You receive a lump sum and repay it in installments over a set term. For a restaurant, where sales swing by day of the week and by season, the key is making sure the payment fits your slow weeks. Here are the options in order and how to use them well.
Key takeaways
- Our recommended funder reviews sales and deposits, works with FICO 500+ and often decides in 2 to 4 hours.
- OnDeck offers $5,000 to $400,000 for up to 24 months with 1 year in business, $100,000 in annual sales and a 625 FICO.
- National Funding finances kitchen equipment up to $150,000 over 2 to 5 years.
- For a second location or your building, an SBA 7(a) usually costs less if every owner is a U.S. citizen or national.
- Size the payment against your worst month and match the term to the useful life of what you buy.
How we chose
How we rank. We do not hand out made-up ratings or scores. We compare every option on the same criteria: decision speed, minimum time in business, minimum credit, whether it accepts an ITIN or owners without an SSN, required documents, amounts and collateral. We include only details each company publishes on its official website (checked October 20, 2026); if a detail could not be confirmed, we left it out. For restaurant term loans, we gave extra weight to the published term and payment frequency, because a restaurant collects every day but spends in weekly and monthly cycles. Read the full methodology in how we rank business funding options.
The best term loans for restaurants, in order
Merchant Fund Express (recommended funder). A restaurant deposits sales almost every day, and that is exactly what gets reviewed here: approval is based on sales and deposits, not just credit. It considers profiles from FICO 500+, with amounts from $5,000 to $5,000,000 and decisions that often come in 2 to 4 hours. Collateral is not required in most cases, it accepts applicants with an ITIN (no SSN needed), it offers Spanish-speaking support, and applying is free with no impact to your credit. Apply here.
OnDeck (term loan). $5,000 to $400,000, with terms up to 24 months. It asks for 1 year in business, $100,000 in annual sales, a business checking account and a 625 FICO. A fit for established restaurants that want to remodel the dining room or upgrade equipment.
National Funding. Two useful routes for restaurants: new or used equipment financing up to $150,000 with monthly payments over 2 to 5 years, and working capital up to $500,000 with daily or weekly payments over 4 to 24 months. Most of its customers have a FICO of 600 or higher, per its website.
Credibly. Its working capital loan runs $25,000 to $600,000. It generally asks for 6+ months in business, revenue deposited in the bank and credit of 550 or higher. Useful for younger restaurants with good sales.
Bluevine. Besides its line of credit, it offers term loans up to $500,000 via partner lenders. For its line it asks for an LLC or corporation with 12+ months, $10,000 in monthly sales and a 625+ FICO.
SBA 7(a) loan through a bank. Up to $5 million, with monthly payments and long terms, for working capital, equipment or real estate. If you qualify, it usually costs less than any online option. Since March 1, 2026, every owner must be a U.S. citizen or U.S. national with a principal residence in the U.S.
Comparison table
| Option | Published term | Credit | Minimum time | Amounts |
|---|---|---|---|---|
| Merchant Fund Express | Based on your profile | FICO 500+ | Based on sales and deposits | $5,000 to $5,000,000 |
| OnDeck term loan | Up to 24 months | 625 | 1 year and $100,000 a year | $5,000 to $400,000 |
| National Funding (equipment) | 2 to 5 years, monthly | Most 600+ | Not published | Up to $150,000 |
| National Funding (working capital) | 4 to 24 months, daily or weekly | Most 600+ | Not published | Up to $500,000 |
| Credibly | Short term | 550+ generally | 6+ months | $25,000 to $600,000 |
| SBA 7(a) | Long term, monthly | Set by the bank | Set by the bank | Up to $5 million |
What to finance with a term loan, and on what term
Match the term to the useful life of what you buy. That way you are not still paying for something that no longer brings in sales:
- Hood, fire suppression, walk-in cooler, combi oven: equipment that lasts years. Equipment financing or a long-term loan. See equipment financing for restaurants for the details.
- A dining room or restroom remodel to pass inspection: a medium or long term. If the inspector gave you little time, a fast loan can cover the work and be refinanced later with something cheaper.
- A second location: the biggest investment. Ideally an SBA or bank loan, plus separate working capital for the first months while the new spot fills up.
- Patio, awnings or a seasonal terrace: a short or medium term; it should pay for itself with that season's sales.
- Point-of-sale system, kitchen display screens, tablets: a short term or a lease; that technology ages fast.
- Busy-season inventory and payroll: a term loan is not always best here; a line of credit usually fits better. Compare in business line of credit for restaurants.
Does the payment fit your worst month?
A restaurant has strong weeks and slow weeks, and a term loan payment does not change. Before you sign, run this check:
- Find your worst month of the past year on your bank statements, for example January or the month the street was torn up for construction.
- Subtract your fixed costs: rent, payroll, suppliers, utilities, insurance and delivery app commissions.
- What is left is your real room for a payment. If the monthly payment does not fit there, borrow less or look for a longer term.
- Check the frequency. A daily payment is drafted on days you are closed too. If you close on Mondays, ask whether the draft can be weekly.
- Ask about prepayment. Some contracts charge part of the interest even if you pay early; OnDeck, for example, explains its policy on its website.
What fits your type of restaurant
Not every restaurant runs the same way, and that changes which term loan fits:
- Taqueria or neighborhood family restaurant: steady daily sales, lots of cash and card. A funder that reviews deposits answers fast; make sure you deposit the cash so your full sales show.
- Full-service restaurant with a bar: higher sales on weekends and in season. A monthly or weekly payment is easier to plan than a daily one. For big remodels, compare an SBA loan.
- Kitchen with heavy delivery or takeout: part of your sales arrive through apps with a delay. Plan the payment around the days those payouts land.
- Seasonal or tourist-area restaurant: the payment has to survive the off-season. Apply during the strong season, when your statements look best, but size the payment on the slow months.
- Bakery, café or restaurant with catering: big orders paid after the event. Combine a term loan for equipment with a line for orders.
In every case, keep restaurant accounts separate from personal accounts and save your point-of-sale reports. They are your best proof of sales.
Documents and common mistakes
Papers you will be asked for: 3 to 6 months of bank statements, sales reports from your point-of-sale system, your health permit and current licenses, your lease, quotes for the equipment or construction, and tax returns for large amounts or SBA loans. If you sell through delivery apps, keep their payout reports handy so those sales show in full.
Common mistakes:
- Remodeling with short-term money and running out of cash to operate while the work wraps up.
- Opening another location without working capital for the first months. The loan covers the build-out, but wages start before sales do.
- Ignoring tips and app payouts when you calculate real sales.
- Stacking an advance on top of a loan without checking whether both payments fit.
To see every option for your restaurant, not just term loans, check the best restaurant business loans. Prefer Spanish? Leer en español.
Frequently asked questions
What is the easiest term loan for a restaurant to get?
The ones that review sales and deposits as well as credit. Our recommended funder considers profiles from FICO 500+ and often decides in 2 to 4 hours. Banks and SBA loans usually cost less, but they ask for more paperwork and take weeks.
Can I finance the hood and walk-in cooler for my restaurant?
Yes. For equipment that lasts years, equipment financing with monthly payments makes sense. National Funding, for example, finances new or used equipment up to $150,000 over 2 to 5 years. Bring the supplier's quote.
Can I get a term loan to open a second restaurant location?
It is possible if your first location has a solid sales history. For an investment that big, compare an SBA 7(a) or bank loan with online options. Also ask for working capital to cover the new location's first months.
How long does my restaurant need to be open to get a term loan?
It depends. OnDeck asks for 1 year; Credibly generally publishes 6+ months. Our recommended funder reviews your current sales and deposits. With less than 6 months, options are few; consider equipment financing or waiting until you have more history.
Do my delivery app sales count?
Yes, if they are deposited into the business account. Apps pay out with a delay and deduct commissions, so what you see in your account is less than what you sold. Keep the payout reports handy to explain your real sales.
Is a term loan or a line of credit better for a restaurant?
For a fixed-price purchase, like a remodel or equipment, a term loan. For expenses that come and go, like seasonal inventory or payroll in slow weeks, a line of credit. Many restaurants use both.