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A business line of credit (LOC) is like a credit card; a financial institution processes your application and determines the amount they are comfortable advancing to your business. Once approved, funds can be drawn directly into your business checking account, and you can use some or of all the amount you are approved for as you see fit. Interest is only charged on the amount you draw when you draw it and can be paid back immediately or over a specified period. Business lines of credit are revolving, which means that unlike a loan, the available funds replenish as they are paid back. While business lines of credit do not earn rewards points the way some credit cards do, they often come with lower interest rates and without the costly fees for withdrawing cash.
Business lines of credit can be a critical lifeline for business owners. Having an available pool of funds to draw from in an emergency may be the difference between a business staying open or closing their doors. Unforeseen expenses such as broken equipment or slow-paying clients can cause cashflow problems that ripple into other areas of your business. An active business line of credit can ensure you continue to run smoothly despite sudden financial strains.
If you’ve been in business at least six months, have $60,000+ in annual revenue and a credit score of 550 or higher, you may qualify for a business line of credit. Offers may be secured or unsecured, depending on your individual qualifications.
Applying for a business line of credit is easy! Just complete our quick and simple online application and upload your three most recent business bank statements. Once received, a member of our staff will contact you to review and discuss your financing options.
