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Best business loans for renovations and buildouts in 2026
The best financing for a renovation or buildout is a term loan for smaller projects and an SBA 7(a) or 504 loan for larger ones, since improvements last for years and should be repaid over years. Equipment financing can take the equipment portion. If you lease, make sure the loan term does not run past the lease.
By the WithFunded team · Published November 11, 2026 · Rates as of November 2026
The short list
- Best for projects under about $150,000
- Online term loan
- Best for a major leasehold buildout
- SBA 7(a) loan
- Best for improving property you own
- SBA 504 loan
- Best for the equipment within the project
- Equipment loan
- Best for overruns
- Business line of credit
The 5 best options, ranked
1. Online term loan Best for projects under about $150,000
A fixed loan matches a fixed construction budget, and online lenders fund quickly enough to keep a contractor's schedule.
Watch for: A longer term lowers the payment but raises the total interest you pay. Term loan guide →
2. SBA 7(a) loan Best for a major leasehold buildout
Leasehold improvements stay with the landlord's building, so they are poor collateral. The SBA guaranty makes lenders willing to finance them long term.
Watch for: Heavy documentation, and the timeline rules it out for anything urgent. SBA loan guide →
3. SBA 504 loan Best for improving property you own
Renovating an owner-occupied building is a fixed-asset project, the purpose of the 504 program, at its low CDC rate.
Watch for: Only for fixed assets. It cannot fund payroll, inventory, or other working capital. SBA loan guide →
4. Equipment loan Best for the equipment within the project
Kitchen lines, lifts, and built-in machinery can be carved out and financed on their own collateral.
Watch for: Older or highly specialized equipment gets shorter terms and higher rates. Equipment financing guide →
5. Business line of credit Best for overruns
Construction rarely lands exactly on budget. A line absorbs change orders without reopening the main loan.
Watch for: Some lenders add draw or maintenance fees, and a limit can be cut at renewal. Business line of credit guide →
Side-by-side comparison
| Option | Verdict | Cost basis | Funding speed | Qualifies on |
|---|---|---|---|---|
| Online term loan | Best for projects under about $150,000 | Representative 8%–30% APR, fixed payments over 6 to 60 months | Days | Revenue, time in business, and credit |
| SBA 7(a) loan | Best for a major leasehold buildout | Capped at 10.00%–13.50% by loan size (prime plus the SBA maximum spread) | Weeks to months | Generally stronger credit and two or more years in business |
| SBA 504 loan | Best for improving property you own | CDC portion roughly 6.6% on 10 to 25 year terms | Weeks to months | Owner-occupied real estate or major equipment, plus a down payment |
| Equipment loan | Best for the equipment within the project | Representative 8%–30% APR, with the term matched to the equipment's useful life | Days to weeks | The equipment is the collateral, which can offset a thinner credit profile |
| Business line of credit | Best for overruns | Representative 8%–30% APR, charged only on what you draw | Often days | Revenue, time in business, and credit |
What it costs
Monthly payments on a standard fixed-payment loan at the representative 8%–30% APR band. The low end of each range is 8% APR and the high end is 30% APR.
| Amount | 36 mo | 60 mo | 84 mo |
|---|---|---|---|
| $50,000 | $1,567–$2,123 | $1,014–$1,618 | $779–$1,430 |
| $150,000 | $4,700–$6,368 | $3,041–$4,853 | $2,338–$4,289 |
| $300,000 | $9,401–$12,735 | $6,083–$9,706 | $4,676–$8,578 |
Financing $150,000 over 60 months costs about $3,041–$4,853 a month, or $32,488 to $141,181 in total interest, depending on the rate you qualify for. WithFunded calculation, representative 8%–30% APR band. Not a quote.
What lenders look at
- Contractor bids and a detailed budget.
- Remaining lease term and any tenant improvement allowance from the landlord.
- How the improvement increases revenue or cuts costs.
Mistakes to avoid
- Financing a buildout over more years than you have left on the lease.
- Starting construction without a contingency for overruns.
Frequently asked questions
- Can I get a loan for leasehold improvements?
- Yes. Term loans and SBA 7(a) loans commonly fund them. Lenders will ask about the lease term, since the improvements cannot be removed if you leave.
- What is a tenant improvement allowance?
- Money a landlord contributes toward your buildout, usually negotiated in the lease. It reduces the amount you need to borrow.
- How much does a $150,000 buildout loan cost per month?
- At a representative 8%–30% APR, about $3,041–$4,853 a month over 60 months.
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How we ranked these options
This guide ranks types of financing, not individual lenders. Each option is ordered by how well it fits the need described on this page, judged on four things in this order: whether the structure matches how the money will be used and repaid, total cost, funding speed, and how hard it is to qualify. Cost figures are WithFunded calculations from published rate inputs as of November 2026: the bank prime loan rate from the Federal Reserve, the SBA maximum-rate schedule, and Federal Reserve survey data. The method follows our 2026 SMB Financing Cost Report, whose own figures use June 2026 rates.
WithFunded is a financing marketplace, not a lender. Our 2-minute form suggests a product type from the families we cover, and a funding partner reviews the request. Not every structure named in this guide is available through WithFunded: options such as SBA microloans, USDA farm loans, bank loans, and seller financing are ones you would pursue directly with the provider. They are listed because leaving out a good fit would make the ranking less useful.
Related guides
The top-ranked option on this page is online term loan because it fits the most common version of this need. Your own best fit depends on your revenue, time in business, credit, and how fast you need the money.
Disclaimer. WithFunded and Big Think Capital are a financing marketplace; we are not the direct lender and do not guarantee funding, approval, rates, or terms. Everything on this page is a representative example only — not an offer or a commitment to lend, and not financial advice. Actual rates, fees, payments, and terms are set by the funding lender and depend on your business, credit, and the product. Where required by state law, the lender provides cost-of-financing disclosures before any agreement is signed.