One payment instead of five, at a lower cost, is the goal. Here is how each consolidation option works, what lenders look for, and what to do if your merchant cash advances or credit make a new loan hard to get.
Last updated October 20, 2026 · Expert review by Kate Morgan, debt relief specialist (20+ years)
Business debt consolidation means taking out one new loan to pay off several business debts, so you make one payment instead of many, ideally at a lower total cost. The main tools are an SBA 7(a) refinance, a conventional bank or online term loan, and a business line of credit. Consolidation works best when the business has steady revenue, good credit and no recent defaults. If you carry merchant cash advances or are already behind, a negotiated restructuring or settlement is often more realistic than a new loan.
| Option | Best for | Typical requirements | Watch out for |
|---|---|---|---|
| SBA 7(a) refinance | Larger balances and long terms with lower payments. | Strong credit, two or more years in business, solid cash flow, full documentation. Slow to close. | Not every debt is eligible; MCAs and recent defaults can block approval. |
| Bank or credit union term loan | Established businesses with good credit. | Financial statements, tax returns, collateral or a personal guarantee. | Hard to get while carrying MCA debt. |
| Online term loan | Fast funding when a bank says no. | Lighter paperwork, often six months to a year in business. | Higher rates; make sure the total cost is actually lower than what you are replacing. |
| Business line of credit | Clearing card balances and smoothing cash flow. | Revenue history and credit; limits are often smaller. | Variable rates and the temptation to draw it back up. |
| Debt restructuring or settlement | Businesses that cannot qualify for a new loan. | Real revenue and a payment burden you cannot sustain. | Fees, possible tax impact on forgiven debt, and creditors may refuse. |
A business owes $40,000 on credit cards, $60,000 on a three-year term loan and $50,000 on a merchant cash advance. The monthly payments are roughly $1,200 on the cards, $2,200 on the term loan and $9,800 on the advance, about $13,200 a month.
Replace all three with a hypothetical $150,000 loan at 12% over seven years and the payment is about $2,650 a month. Almost all of the saving comes from the MCA, which was costing about 116% APR. Check your own advance in the MCA calculator.
The catch: the same MCA that makes consolidation valuable is often the reason a lender declines.
Gather your last six months of bank statements, two years of tax returns, a current profit and loss statement and a list of every debt with its balance, payment and lender before you apply.
Restructuring asks existing creditors for smaller payments over a longer term. It is the closest thing to consolidation that does not need new credit. Negotiated settlement resolves balances for less than the full amount, usually with a lump sum or short payment plan. Legal review matters if you face lawsuits, confessions of judgment or aggressive collections. See business debt negotiation and all business debt relief options.
We review your debts, payments and revenue, then connect you with an independent specialist whose programs fit your situation, whether that is a lender, a restructuring firm or an attorney. The review is free. We do not lend money and we do not give legal advice.
Using one new loan to pay off several business debts, so you have one payment, ideally with a lower rate or total cost.
It is harder. Online lenders may approve weaker credit at higher rates, which may not save money. If you cannot get a loan that lowers your total cost, restructuring or settlement may work better.
Some lenders will pay off MCAs as part of a consolidation loan, but many decline businesses with several active advances. See our MCA consolidation guide for the alternatives.
Applying usually involves a credit check. Over time, one on-time payment can help. Closing paid-off accounts or missing the new payment can hurt.
SBA 7(a) loans can refinance eligible business debt with long terms, which can lower payments substantially. Approval takes longer and requires strong credit and documentation.
Consolidation replaces debts with a new loan and repays them in full. Settlement negotiates the balance down and may have tax consequences on the forgiven amount.
Get a free review. We will tell you which path fits your numbers, loan or not.
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