A business line of credit is a useable credit amount provided by a funder in which the money is to be used freely, when needed. Monthly payments on the business line of credit initiate once credit has been drawn.
Who Qualifies for A Business Line of Credit?
Most sources require an active business checking account and for you to provide financial documents from the previous 2+ years. There are numerous qualification factors but most important is the credit score of the small business.
What Businesses Are Business Lines of Credit For?
Business lines of credit are for any small business owner seeking to have access to funds when they are needed. Not to be mistaken for business credit cards, lines of credit are a good option to balance the peaks in valley in business. Business lines of credit provide the peace of mind for qualifying businesses who have the proven history of repaying loans.
How Much Do Lines of Credit Cost?
Business Line of Credit Loan Calculator Business Lines of credit rates range roughly from eight to twenty-four percent. Business lines of credit rate's are correlated directly with credit scores, the better the score the lower the rate will be. Small business owners with 680+ credit see rates as low as prime +. If you are dealing with less than par credit, non-traditional business loans may be your best option but keep in mind they have slightly increased rates.