Every business owner needs cash from time to time. The answer may be a revolving credit line.
What is a Revolving Credit Line?
A revolving credit line is a business loan that is somewhat like a credit card. When you are approved for a revolving credit line, you can use as much money as you are approved for and pay interest only on what you use. Funds are replenished up to the amount of the loan and funds can be used and repaid during the term of the loan.
The draw period for these loans is typically one or two years. At the end of that period, the lender may agree to renew the loan and extend the draw period.
Depending on the lender and the loan amount, collateral may be required. The better the collateral, the better the loan terms.
Business lines of credit loans are standard in the financing industry. They may be issued by banks, alternative lenders, financing specialists, and the Small Business Administration.
It is important upfront to decide what amount of money you will need and to carefully choose a lender.
Advantages of a Revolving Credit Line
A revolving credit line becomes essentially “money on demand.” You can use the funds whenever you need them rather than applying and waiting for loan approval every time a need arises. Generally, you can use whatever amount you need up to the credit limit and can use the loan up to the defined term. Interest rates are generally lower compared to other types of loans. There are no fees or penalties for paying off the loan early, depending on the provider of the loan.
Seek Expert Financing Assistance
Contact Means Commercial Capital to get the financing assistance you need. We have a large portfolio of business loans to serve a variety of business needs, including construction financing, commercial real estate financing, and fix and flip financing. Our professionals will work with you to develop a loan to match your needs. We’ll help you get the means to meet your dreams.