LINES OF
CREDIT
LINES OF CREDIT
What ARE LINES OF CREDIT?
A line of credit is a valuable tool to have in case of emergency cash needs. It’s a good idea to set one up ahead of any unforeseen events so you don’t have to worry about the application process when you’re under stress. If you have a balance, you’ll need to make monthly or quarterly payments. However, you can borrow more when you want the added support and up your payments when you can afford to. That will help you stay ahead of your balance and keep your credit in good condition.
Not all lines of credit are the same. For example, you can choose secured, unsecured, revolving, non-revolving, or no-recourse lines of credit. Which line is right for your small business? Let us walk you through the options and help you choose the line that suits your needs. We won’t give up until you’re satisfied with a great line of credit for your business.
ADVANTAGES
Available when you need it as often as you need it.
Use equity to determine how much you can borrow.
Smooth out the seasonal revenue cycle.
Keep your account current to improve your credit.
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lines of credit
Options
SECURED
A secured line of credit lets you leverage the equity you have in real estate, equipment, or other assets to open an account. You’ll get the value of those assets in an available credit limit you can use for any valid business expense. As long as your account is in good standing, your assets are secure.
UNSECURED
An unsecured line of credit keeps your company assets off the table. If your business has a high credit rating and a strong history of repayment, you may qualify for an unsecured line. It works just like a secured line, but without hard assets to back it up. Find out more about the eligibility requirements through our experienced brokers.
NON-REVOLVING
Some lines of credit don’t renew with monthly payments. Instead, when you use a portion of your balance, it doesn’t get replenished. A non-revolving line of credit closes when the credit limit has been reached and all payments have been made. Businesses choose non-revolving accounts for their lower interest rates and predictable payment schedules.
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FAQ
Q. When is a line of credit not the right choice?
A line of credit works well for meeting short-term working capital needs. However, it’s not well-suited to funding high-ticket items like real estate, equipment, or construction. Instead of a line of credit, let us show you a specialized loan that can handle your next big investment.
Q. How do I choose a line of credit?
With all of the credit options out there, it can be a challenge to sort through them all on your own. That’s why partnering with a professional broker is a step in the right direction. We know each option inside and out so we can serve you with knowledge and experience. Let us know where you see your business headed and we’ll help you get there with a line of credit that’s right for you.
Q. How is a line of credit different from a business credit card?
While they’re similar in many regards, lines of credit are often less expensive than credit card accounts. If you want the availability of credit with a low interest rate and higher spending limit, choose a line of credit over a card. You’ll still be able to access your account with the ease of a credit card but without the high fees.
Q. What is a non-recourse line of credit?
With a secured line of credit, your company’s assets are used to secure the line. That means, if you default, the lender can seize those assets. With a non-recourse line, the lender is unable to go after any assets your company hasn’t used specifically for that purpose.