What is a Business Line of Credit

Written By: John Tejada Published On: 12/04/18

A business line of credit are a financial product that is offered to small business owners nationwide because of the peace of mind that it brings. Pay only as used, up to $250,000, weekly payment frequency dependant on used credit? I mean come on what else can you ask for? You will be convinced sooner rather than later.

To view all of AMP Advance’s Small Business Financing Options click HERE

 

Why apply for a business line of credit?

The absolute plethora of uses of a small business line of credit is what puts small business owner in the driver’s seat. No more are the days of peaks and valleys in sales weeks. Small business owners in the 21st century are currently utilizing credit lines for their benefit. A product used by the financially responsible, small business lines of credit are certainly helpful when unexpected expenses arise. At the end of the day, isn’t it nice to have cash on hand exactly when you need it? Unlike anything else in your life, a business line of credit will always be there when it is needed. The best part, if you do not need it you do not have anything to pay.

Businesses qualifying  with AMP Advance for a business line of credit are able to get through all sales valleys due to the convenience of the credit line they hold in their back pockets. How many times do unexpected business opportunities present themselves? All the time! Cash is key in being able to never let those profit making opportunities pass you by. Do your providers offer monthly deals that vary? Of course they do! Use a business line of credit to confidently make purchases that save you the most in the long run. Seasonal? A business line of credit will benefit you the most. Get through the winter until projects increase and continue doing what you do best, that is running your business. Now, due to the nature of business lines of credit, it is not recommended to use the entire balance at once to try to solve a larger debt problem. Business lines of credit have compounded interest so the longer the balance is held, the higher the overall cost for the credit becomes.

Now, please do not confuse our line of credit with our business credit card. The business  line of credit is target towards better qualifying clients where qualification for the business credit card is not as tenuous. Even against all recommendations, a majority of small business owners obtain credit cards and cash advances because of the quick and easy application process. As a small business owner you are responsible for being meticulous in everything you do. Why not be meticulous with securing the most cost effective options? Do some research, find all of  your options and pick the option that truly fits your company not only today, but still fits in 60 or 90 days. Stay focused and no matter what, pay attention to fees. If used responsibly, business credit cards can be very cost effective and most of all, convenient when something needs to be purchased right way (or used for bills of course). 9 out of 10 times, based off of our current client’s, the terms of repayment favor our business line of credit dependant on one’s business and personal credit scores being adequate. The revolving credit program does not have a fixed payment structure and the interest charged is dependant on the state of the market. A good start to being that ideal model of a small business owner is to do some research at your local bank branches because these financial institutions provide lines of credit and business loans at subprime rates. Keep doing your research, we know you’ll stop when you find where it says we provide discounts for early repayments. Unlike the institutionalized banking institutions, we have the ability to reward our clients for lowering their balances early and constantly. Our approach is to provide rewards while also providing peace of mind to small business owners. This algorithm has proved itself tenfold and it is clear how business improves and stays steady when our clients are truly happy. Never fear, AMP is here to provide the peace of mind that all small business owners seek.

I Secured A Line of Credit, Now What?

Now you have the freedom to do what needs to be done to handle operational expenses without a worry. Are you a restaurant owner or own a retail store? How often do sales vary with unexpected factors? Inclement weather alone can reduce sales by over 75% and normal $100,000 weekends can become $10,000. With that line of credit that you just secured you know you will literally make it through the rain. Inventory for the next week will be covered and you are able to fight another day. It is not suggested to spend your whole balance at once because every small business owner must become acclimated with their new holdback percentage (holdback percentage- debt to income ratio). If you are a new small business owner and have new credit then this time is crucial to make the right decisions and be responsible to collect as much positive data on your credit report right from the start.

Every entrepreneur knows the saying cash is king. Cash is what allows you to open your doors, pay for the bills to operate, and even to provide improvements to drive an increase in sales. No small business owner should be stacking their pennies or staring at their ceiling all night thinking what have they done. There are answers and ways to initiate improvement and the only way to improve is to act. Research, find the most cost effective options that fit the schedule of your income, and keep strict use in mind. With the line of credit, focusing on growth is easy because you’re taking the focus off of trying to figure out where to get the funds. All businesses, in order to survive, must budget for payroll, marketing expenses, improvements and repairs. As long as you keep your mind open and inspect all options, positive opportunities will present themselves. A business line of credit provides the financial peace of mind so that you can solely focus on improving your business.

 

AMP Advance is a Miami based industry leading direct funding source out of Coconut Grove, Florida. We help those who are in need of small business financing by providing web based financing options & funding solutions. Our solutions assist small business owners find matching opportunities while assisting small business owners improve their overall financial situations. AMP Advance provides small business loans, business lines of credit, accounts receivable financing, equipment financing, unsecured business loans, and revenue based loans to millions of small business owners nationwide.

3 Comments

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