What is a business line of credit?
A business line of credit is a revolving account that allows access to a fixed amount of capital, which can be used when needed to meet short-term business needs. A business line of credit is the best financing option when you need extra working capital to cover recurring business expenses or bridge cash flow gaps. With ongoing access to funds, you have the flexibility to withdraw only what you need, when you need it—and pay for only what you use. So, you’ll be prepared for whatever challenges and opportunities come your way.
Secured vs. Unsecured Line of Credit
A secured business line of credit requires a business to pledge assets as collateral to secure the line. Since a line of credit is a short-term liability, lenders typically ask for short-term assets, such as accounts receivable or inventory. If the borrower is unable to repay the line, the lender may proceed to assume possession of the collateral and sell the asset in order to pay off the balance.
An unsecured business line of credit does not require a business to pledge assets as collateral to secure the line. Unsecured lines of credit typically require the business owner to have a strong credit profile and credit score, along with a positive business track record to qualify.
Is a line of credit useful for my company?
Unlike a term loan, a business line of credit allows you to run your business without having to apply for a new loan every time you need a bit of extra cash. And with ongoing access to working capital, you can plan for and better manage your business’s future cash flow with less stress. Your line of credit can give you the boost you need to take advantage of opportunities when they arise.
One of the main benefits to having a business a line of credit is that it’s revolving. That means you can access the credit line when you need it, pay down the balance, and use the line again as funds replenish.
Loan amount from $5,000 -$100,000
How To Apply
Same Day Approval
To get prequalified, follow the "Apply Now" button and submit some basic business information.
After your submission has been processed by the underwriting team, we will reach out to discuss the options you qualify for.
Upon approval and accepting the offer, funds are deposited directly into your business bank account so you can use the money immediately.
Credit score: 680+
Utilization: below 30%
No recent bankruptcies
Signed one page funding application
3-5 most recent months company bank statements (not all cases)
Full tri-merged credit report
Line of Credit: Advantages and Disadvantages
While the flexibility and revolving nature of a line of credit makes it a great fit for certain cases, it may not be the perfect funding structure for every need.
Only pay interest on the amount you use, rather than the total amount funded
Lines of credit are flexible as long as you stay within your credit limit, making them an ideal solution for stabilizing cash flows and covering essential expenses
Great opportunity to build business credit
It can be difficult to increase your credit limit
Lines of credit often have lower borrowing limits and fees and additional charges can add up if used irresponsibly
Business lines of credit can be more difficult to qualify for than other financing options