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Hotel Financing: Best Business Loans to Consider in 2023

Although hotels can make a lot of money, especially during peak season, owners also need lots of cash to get them up and running. Hotel loans can help business owners finance the construction of a new hotel and purchase or renovate an existing one.

Hotel Financing
Katie Oelker
Written by:Katie Oelker
Personal Finance Expert

Reviewed by: Jen Hubley Luckwaldt, Content Writer and Editor

Fact Checked by: Dr. JeFreda R. Brown, Financial Expert


Many or all of the products featured here are from our partners who compensate us. This may affect which companies we write about and where the company appears on a page. However, any analyses, or reviews expressed in this article are those of the author’s alone, and have not been approved or endorsed by any partner.

To operate or run a hotel business, the owner may need a business loan for expenses such as buying land, purchasing an existing building, starting new construction, and making renovations. The options for lending may seem overwhelming, which is where this roundup comes in handy. Each company we reviewed caters to a particular need, helping make business lending less confusing and more accessible to current or prospective hotel owners.

Hotel Financing: Best Business Loans to Consider

Top Picks for Best Hotel Financing

There are several factors to consider when researching the best hotel business loan. In this review, our experts highlight the rates, fees and terms of each lender and explain what makes each lender a good option. We also share potential downsides of each lender, and provide a rating methodology you can use to select the best option for your needs.


Hotel Financing: Best Business Loan Options Overview

Best Overall
Lendzi logo

Lendzi - Best for Hotels With High Revenue

Factor Rate
Starting at 1.10
Loan Amounts
Up to $4 million
Min. Annual Revenue
Key Features
  • Borrow up to $4 million in working capital
  • Min. credit score: at least 500
  • Min. time in business: 6 months
  • Equipment financing up to $2 million
  • Business line of credit up to $250,000
  • See your options without hurting your credit
  • Flexible terms: 3 to 15 months
  • Excellent customer reviews on independent review sites
  • Get funding in as little as 24 hours
Pros & Cons
  • Multiple lenders and loans to choose from
  • Bad credit accepted
  • Excellent customer service
  • Fast funding times on certain products
  • Competitive rates and fees
  • Must be in business at least six months
  • Must have solid annual revenue

Lendzi works with hotel owners with high revenue that have been denied a loan previously. The company was founded in 2020 and has since funded more than $500 million, and it has accumulated more than 2,000 5-star reviews from previous customers. Customer satisfaction is excellent; making them our top pick for not only high revenue hotels but for any hotel business owner in need of financing.


Main Features
If you have a high revenue hotel, we recommend a working capital loan from Lendzi. This loan allows hotel owners to borrow up to $400,000 with factor rates starting at 1.15. The minimum credit score needed for a working capital loan is just 500. If your credit is great, you can apply for other types of loans from Lendzi. These include short- and long-term business loans, merchant cash advances, commercial mortgages, SBA loans, and equipment financing loans. To qualify for any type of loan from Lendzi, you should be in business for at least six months and have $180,000 or more in annual revenue.

Lendzi is an excellent lender to work with if you have high revenue, bad credit or excellent credit. They are a direct lender and a partner with more than 75 other lenders, giving you plenty of options to choose from. Not only that, but a representative from Lendzi will walk you through the entire process and answer any questions you may have. The application takes just a few minutes to fill out and will not impact your credit score.
Backd business loans

Backd - Best for Large Loan Amounts

Factor Rate
Starting at 1.10
Loan Amounts
Up to $2 million
Min. Annual Revenue
Key Features
  • Borrow up to $2 million
  • Min. Credit Score: 640
  • Min. Time in Business: 2 years
  • Industry best factor rate for MCA - as low as 1.10
  • APR for the Line of credit product starts at 35%
  • Flexible repayment terms up to 16 months
  • Get funding in as little as 24 hours
  • Check your rate with a soft credit pull
Pros & Cons
  • Easy online application
  • Instant lending decisions
  • Fast funding times
  • Large loan amounts
  • No collateral required
  • Startups will not qualify
  • Rates not disclosed

If you need a large hotel business loan, Backd can create a customized loan specifically tailored to your hotel business. Founded in 2018, the company has funded more than 10,000 small businesses. If you need to expand or renovate your hotel, Backd might be the solution you’re looking for. They offer working capital loans up to $2 million that can be used for any hotel business expense.


Main Features
Backd offers working capital loans and business lines of credit to hotel businesses. Working capital loans start at $10,000 and go up to $2 million, with terms maxing out at 16 months. This makes this type of loan best for hotels looking to fund a one-time expense and pay it off quickly. Business lines of credit are more geared to businesses with ongoing expenses who need access to capital frequently. They range from $10,000 to $750,000 with unlimited terms. To qualify for either option, you need to be in business for at least two years, have $300,000 or more in annual revenue, amd 640+ FICO score.

Backd creates loans tailored to your needs. Their application is fast, lending decisions are instant, and funding times can be as soon as one business day. If you're in need of funding for your hotel business, look no further than Backd.
SMB Compass

SMB Compass - Best for Variety of Hotel Loans

Interest Rates
Starting at 7.99%
Loan Amounts
$10K - $10 million
Min. Monthly Revenue
Key Features
  • Loans up to $10 million
  • Min. credit score: can go as low as 550 for certain loans
  • Min. time in business: 1+ years in business, no startups
  • Funding times: 5 to 7 days for term loans and 24 - 48 hours for line of credit
  • Flexible terms: 2 – 10 years for term loans
  • Interest Rates: starting at 8.99% for term loans
  • Applying does not impact credit score
  • Nine loan products to choose from
Pros & Cons
  • Low, competitive rates
  • Large loan amounts
  • Loan terms up to 25 years
  • Excellent customer service
  • Poor credit not accepted
  • Not available in all states
  • Must be in business at least one year
  • High revenue requirements

SMB Compass is one of the best lenders out there for hotel owners who aren’t quite sure what type of funding they need. The lender offers nine different types of loans, including business lines of credit, term loans, asset-based loans, equipment financing, invoice factoring, and more. Customer service is top-notch, so if you need help choosing a product, make sure to contact a representative to help you with that decision. To qualify for most of their products, you’ll need a credit score of 650, a business history of at least one year, and $20,000 or more in annual revenue.


Main Features

SMB Compass offers nine different types of small business loans to hotel owners. Their mission is to make loans more accessible to small business borrowers by providing cost-effective and flexible lending solutions. SMB Compass business loans range from $10,000 to $10 million with terms up to 25 years. Rates start at 7.99% for qualified borrowers. The lender has currently provided more than 1,200 U.S. businesses with more than $250 million in financing. To apply, simply fill out their easy online application. It takes just a few minutes and will not impact your credit score. If approved, funding can be dispersed within 24 hours.

Whether you need a hotel loan to purchase or renovate your space, pay for working capital expenses, or cover expenses during a slow season, SMB Compass can help. The lender offers a variety of loan products to meet your needs. Qualifications are stricter than with other lenders, but if approved, you’ll get a competitive rate, flexible terms, a large loan amount, and excellent customer service. If approved, funds can be in your account within 1-2 business days. Contact SMB Compass to learn more!

SmartBiz - Best SBA 7(a) Loan

Interest Rate
7.5% - 10.29%
Loan Amounts
$30K - $350K
Min. Annual Revenue
Key Features
  • SBA 7(a) loans up to $350,000
  • SBA commercial real estate loans up to $5 million.
  • Min. Credit Score: 660
  • Min. time in business: 2 years
  • Loan Repayment 10 - 25 years
  • SBA 7(a) loan rates: 10.75%-11.75%
  • SBA Commercial real estate loan rates: 5.50-6.75%
  • Receive multiple loan offers
Pros & Cons
  • Lower interest rates
  • 2 types of SBA loans available
  • Streamlined application and support team
  • CRE loan has to be 51% owner occupied
  • Application fee up to $3,000-$5,000
  • Guarantee fee from 2.77% to 3.75%

SBA loans from SmartBiz are a great option for hotel business owners that can qualify. SBA loans are small business loans that are guaranteed by the government and offers longer terms and lower interest rates than other small business loans. SmartBiz offers 2 different types of SBA loans, the SBA 7(a) loan and the SBA Commercial Real Estate (CRE) loans. And even if an SBA loan isn’t the right fit for your business, SmartBiz offers term loans and custom financing options, making financing easier to obtain.


Main Features
The SBA 7(a) loan can be granted in amounts from $30,000-$350,000 and can be used for debt refinancing and working capital. The SBA Commercial Real Estate loan ranges from $500,000 to $5 million and can be used to purchase or refinance commercial real estate. The interest rate for SBA 7(a) loans ranges from 8.25%-9.25% while the SBA Commercial Real Estate loan ranges from 7%-8.25%.

SmartBiz is our choice for SBA hotel loans for their streamlined application process and committed customer support personnel, helping make the arduous process of applying for an SBA loan easier. Terms for payoff range from 10 to 25 years, making SBA loans a great option for hotel business owners.

National Funding - Best For Hotel Construction Loans

Factor Rate
Starting at 1.10
Loan Amounts
Up to $500K
Min. Annual Revenue
Key Features
  • Min. Time in Business: 6 months
  • Min. Credit Score 600
  • Borrow up to $500,000 in working capital
  • Equipment financing up to $150,000
  • Factor rate From 1.10
  • Fast funding
  • Early payment discounts
  • Equipment financing repayment 2-5 years
  • Working capital repayment 4 months - 2 years
Pros & Cons
  • Easy application: You may apply for a loan online, from the comfort of your own home or office, within minutes.
  • Early repayment discount: With a working capital loan, you’ll earn a discount on your remaining balance if you repay it in full within the first 100 days.
  • Positive reviews and high rankings: National Funding has a great reputation on reputable sites like Better Business Bureau (BBB) and TrustPilot.
  • Daily or weekly repayments: National Funding requires daily or weekly repayments on working capital loans, which can take a toll on your cash flow.
  • Origination fee: You’ll be on the hook for an origination fee.
  • Personal guarantee required: Even though you won’t need collateral for a working capital loan, you will need to personally guarantee it.

National Funding offers short-term working capital loans, which can come in handy if you need to fund a hotel construction or everyday expenses during slow seasons. You can borrow up to $500,000 but must commit to daily or weekly repayments.


Main Features
National Funding’s short-term working capital loans range from $5,000 to $500,000 with repayment terms between 4 months and 2 years. To take out a working capital loan, you’ll need a minimum credit score of 600, a business track record of at least 6 months, and $250,000 or more in annual revenue.

If your hotel earns sufficient revenue and needs some extra money to fund working capital expenses, National Funding should be on your radar. This is particularly true if you have steady cash flow and afford to pay off a loan early.
biz2credit review

Biz2Credit - Best for Commercial Real Estate loans

Interest rates
Starting at 7.99%
Loan Amounts
$25K to $500K
Min. Annual Revenue
Key Features
  • Working capital up to $2 million
  • Term loans up to $500,000
  • Term loan interest rate starts at 7.99%
  • Loan Repayment 12-36 months terms
  • Variable APR depending on the applicant
  • Funding in 72 hours
  • Soft credit pull
Pros & Cons
  • Quick approval and funding
  • Support from commercial loan specialist
  • Apply online or over the phone
  • High loan amounts
  • Must already own commercial property
  • Longer time in business needed
  • Higher annual revenue required
  • Potentially higher interest rates

Biz2Credit offers commercial real estate secured loans to those looking to acquire new hotels or fund a hotel renovation. Hotel owners can qualify in as little as 48 hours. You have 12 to 36 months to pay back the loan. Interested borrowers can apply online or call Biz2Credit’s hotline at 800-200-5678.


Main Features
To obtain a Biz2Credit commercial real estate loan, you must have a credit score of at least 660 and have been in business for at least 18 months. They also need to have a minimum of $250,000 of revenue a year. Loan amounts start at $250,000 and go up to $6 million with rates starting at 10%. Repayment options include interest-only and monthly payments, giving the borrower flexibility and predictability during the debt payoff process.

Biz2Credit is our choice for commercial real estate loans thanks to their high loan amounts and dedicated specialists helping each step of the way. We also love the ability to use the loans for a variety of reasons, including renovating a hotel or purchasing a new one, as well as the monthly and interest-only payment options.


Min. Annual Revenue
Min. Time in Business
6 months
Min. Credit Score
Key Features
  • Borrow up to Up to $250,000 in term loans
  • Borrow up to $400,000 in working capital
  • Term loan rates range between 8-25%
  • Working capital factor rate starts at 1.09
  • Simple application process
  • As soon as same day funding
  • Open to high-risk industries
Pros & Cons
  • No annual revenue required
  • Quick approval and funding
  • Potential tax deduction
  • No credit score required
  • Can only be used for equipment financing
  • If repairs are needed, debt can increase
  • Equipment can be collected as collateral
  • Some information not available online

Credibly offers an equipment financing loan, perfect for hotel business owners. Applying for equipment financing only takes 10 minutes, and you can get approved in as little as four hours. Hotel owners can expect funds to be deposited into their bank account on the same day. Equipment financing can also help hotel business owners increase their tax efficiency through a Section 179 tax deduction.

Main Features

Credibly’s equipment loan is typically easier to obtain as the new machinery will be used as collateral. Their equipment loan does not require a minimum credit score or minimum annual revenue to qualify. On the downside, if you can no longer repay the loan that equipment will be collected. Borrowers can obtain $10,000 to $10,000,000 depending on the type of business with rates starting at 1.09%. The amount of time needed in business to qualify is not specified, so speaking with a loan specialist may be necessary. 

With low interest rates and flexible terms, Credibly equipment loans can be a good option for hotel business owners. The opportunity to receive funding with no credit score or minimum annual revenue required also helps Credibly stand out among its competitors.

Main Features of The Best Hotel Financing Companies

SMB Compass4.5
National Funding4.1
  • Min. Credit Score - 500
  • Min. Time in Business - 6 months
  • Min. Annual Revenue - $180,000
  • Loan Amount - Up to $400,000
  • Interest Rate - Factor rates starting at 1.15

How to Choose the Best Hotel Financing Option

  • Loan features: Loan features include terms, repayment options, and minimum amounts.
  • Application process: How invasive is the loan process? Consider whether there is a hard-pull or soft-pull credit score impact. How long it will take to receive the funding? Also, look for any distinctly competitive offerings.
  • Interest rates and fees: Rates and fees have an impact on the total amount of money your company will owe.
  • Qualification process: What do you need in order to qualify? Each lender has its own requirements for hotel business loans including minimum credit score, annual revenue, and business history.
  • Customer support: What kind of customer support does the lender offer? Consider whether you will have the option to speak with a live representative, access an online portal, or communicate via chat.
  • Online user reviews: Look at independent review sites such as TrustPilot and the Better Business Bureau to make sure that the company you consider for hotel construction loans has positive user reviews.
  • Perks and bonuses: Service offerings like payment flexibility, transparency in fees, and advanced technology features may be helpful when financing a hotel purchase.


How Much Does It Cost to Open a Hotel?

All values are based on average market prices. According to Hotel Tech Report, the percentages you see in the brackets show the ratio of a particular line in the project's total cost.

  • Hard costs and site improvements $255,400 (76%): This category includes everything from land costs to permits, building, engineering, and landscaping. Other expenses include plumbing, finishes, parking, and site improvements.
  • Soft costs $41,800 (12%): These are the skill-based fees you offer to the professionals like architects, designers, lawyers, and accountants. This category also carries the franchise application costs, land closing fees, taxes, and insurance.
  • Furniture, fixtures, and equipment $29,100 (9%): This line includes the calculations for all types of furniture and fixtures, kitchen equipment, washers and dryers, technology in the meeting rooms, room cards, and other appliances.
  • Pre-opening and working capital $10,700 (3%): Last but not least, you need to collect staff and make some effort to train them in advance. This line is all the funds needed for operating reserves, technical services, recruiting, and purchases.

As you can see, opening a hotel requires a large amount of initial capital. You should also consider amortization over the years, ongoing staff training, and many other current and future expenses, which will help you keep the accommodations up-to-date and avoid larger spending later down the line.


What Can You Use Hotel Loans for?

  • Purchasing an existing hotel: Financing a hotel purchase allows interested investors to buy existing hotels that may be for sale. Without funding, many owners simply would not have the funds to purchase a property outright.
  • Remodeling or renovations: Hotel loans give business owners the funds to remodel or renovate an existing hotel.
  • Purchasing land for new build: Some hotel business loans will give the option to purchase land for owners to build a brand new hotel on. Land is expensive and so funding makes it possible to obtain it when needed.
  • Constructing a new hotel: Hotel construction loans allow investors to construct a new hotel either by demolishing a former commercial building or building a brand new hotel on purchased land.
  • Buying new technology for hotel: Old hotels may have systems that need to be upgraded, including security and reservation management. Hotel financing makes these updates possible.
  • Hotel maintenance: Obtaining a loan for a hotel business can give borrowers adequate funds to maintain a hotel, covering expensive repairs that owners can’t afford otherwise.


How Does a Hotel Loan Work?

In the United States, the steps you need to take to apply for a hotel loan are simple.

  • Complete an application form and wait for approval.
  • Once the lender has approved your application, the loan money will be transferred to your business account.
  • You can then use the loan money for different purposes–from establishing to improving your hotel business.
  • Once your hotel business begins to gain momentum, you can start making repayments to the company. However, the loan amounts, rates, and requirements can change depending on the lender.


Common Hotel Loan Amounts

The amount of money you can borrow for a hotel loan varies from lender to lender. In the majority of cases, the lender will make decisions according to your current cash flow, the size of your hotel, the purpose of the loan, the number of years your hotel has been in operation, and more. Small hotels may be loaned $100,000 to $1 million, while more established hotel businesses may get financing as large as $50 million.


Hotel Financing Rates

Like the loanable amount, financing rates will vary according to your application and the lender. Expect interest rates to be around 6.5% to 12%. If you wish to apply for a hotel loan from a bank, the financing rate they offer could be lower. However, there may be harsher lending criteria. If you need a quicker and easier approval, you may wish to borrow from private lenders. If you do so, you will likely be required to pay higher interest rates.


How to Qualify for Hotel Financing?

When looking at financing a hotel purchase there are several companies to choose from. Each company has unique lending options, suited for everyone from existing owners to startups. While lenders have their own unique qualifications they consider, most will include the following factors:

  • Credit score of business: Is your credit score high enough to qualify?
  • Time in business: Have you been in business long enough to qualify?
  • Annual revenue: Do you have the minimum amount of annual revenue to qualify?

Once you’ve determined you’re eligible enough to potentially qualify, most applications can be completed online or over the phone. If applying online, a customer representative may contact the interested applicant to go through the application and determine the next steps. Typically further documentation will be required. After the applicant is approved, funding will enter the borrowers’ bank account within a few days to a few weeks or longer.


Other Types of Hotel Financing

The hotel business is changing. Not every hotel business owner operates a traditional hotel or franchise. To find a loan that fits your unique situation, consider these options:

Bed and Breakfast Business Loans

Bed and breakfast loans include working capital loans, business lines of credit, and short-term loans. Consider options that fit your credit and business history. Pay attention to fee structures–some loans have origination and borrowing fees that will add to your debt.

Airbnb Loans

Depending on your needs, you might choose to finance an Airbnb or VRBO business with working capital, term, or business loans. You might also look at lines of credit for short-term expenses. Keep in mind that loan amounts and terms vary widely.



Hotel owners, either current or hopeful, need hotel loans to run their business. Whether it's purchasing land, renovating an existing hotel, constructing a new hotel, paying for maintenance, or upgrading systems, hotel ownership costs a lot of money. Luckily, some lenders are willing to help. While the process to apply can be daunting, the lenders we reviewed make it a top priority to help their customers obtain good hotel financing rates and terms. Do your homework to decide which lender fits the needs of your business best.


*The required FICO score may be higher based on your relationship with American Express, credit history, and other factors.

Katie Oelker

Written by: Katie Oelker

Personal Finance Expert

Expertise in financial topics including budgeting, saving, simplifying investing, life and disability insurance, credit building and maintenance, and credit card travel rewards.

More about me
Jen Hubley Luckwaldt

Reviewed by: Jen Hubley Luckwaldt

Content Writer and Editor

Jen Hubley Luckwaldt is an editor, writer, and content strategist with a focus on personal finance, careers, and DEI. A small business owner for over a decade, Jen helps publications and brands create and optimize B2B and B2C content.

More about me
Dr. JeFreda R. Brown

Fact checked by: Dr. JeFreda R. Brown

DBA, CFEI and a highly respected expert in personal and business finance

Dr. JeFreda R. Brown is more than a financial consultant: she’s an avid teacher and subject matter expert who helps people—individuals and groups in a business setting—master the skills they need to achieve lasting financial wellbeing. As Founder and CEO of Xaris Financial Enterprises, it is her passion and life goal...

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