A United States business line of credit is revolving capital you can draw from whenever you need it. Pay it back, and the credit becomes available to draw again. Think of it as a high-limit business credit card with much better rates and direct ACH access.
For American businesses, lines of credit are particularly valuable because so many industries are seasonal. Beach and lake towns peak in summer. Ski towns and Sun Belt resorts peak in winter. Retail peaks around the holidays. Severe weathers and winter storms create unpredictable disruption. A line of credit lets you draw cash when you need it and pay it down when revenue surges back, paying interest only for the time you actually use the money.
How a Business Line of Credit Is Structured
Limits, rates, draw terms, repayment schedule, and renewal terms vary by business and are stated in your written offer. Review each item before you accept.
What We Look At
- Time in business
- Monthly revenue and bank deposits
- Credit profile
- An active business bank account
The Application Process
- Apply online with basic business and owner information
- Share recent business bank statements
- Review your written offer and its terms
- If you accept, funds become available as described in your offer
Common Questions
A line of credit is revolving: you draw, repay, and draw again, and the cost applies to the funds you draw. Working capital is a single lump sum. A line of credit suits variable or recurring needs; working capital suits a defined, one-time need.
Fees and costs vary by offer. Your written offer lists every fee and cost before you sign.
Draw availability and any conditions are set out in your offer. Review them before accepting.
Revenue, bank activity, time in business, and credit profile all play a role.
Repayment frequency and amounts are stated in your written offer.
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