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Business lines of credit are flexible forms of financing that borrowers can use as needed. Think of them as credit cards where you only pay fees on whatever is used. Once you pay off your balance, your line of credit is replenished and you can again use however much you were approved for. Because you only pay fees for what you use, they offer a lot more flexibility than, say, term funding, which require you to start paying interest fees as soon as the funding is taken out.
Business lines of credit are best for ongoing expenses like payroll, funding short-term projects or any other short-term recurring capital needs. As most business lines of credit take at least one business day to fund after you make a draw, they’re not the most liquid option here, and if that is your primary concern, we recommend looking at business credit cards. However, they are revolving (meaning your credit line replenishes every time you pay off your balance, like a credit card), making them a more appropriate option for ongoing expenditures than, say, a lump sum funding. If you’re looking to fund an ongoing marketing campaign or need funding to pay your employees, a line of credit is ideal especially if you’re unsure of exactly how much you’ll need.
No Personal Guarantee &
No Collateral Required*
Get Funded Within
a few days
No Personal Guarantee &
No Collateral Required*
Within 24 hours of
application
A Business Line of Credit is ideal if your business needs easy access to cash for short-term capital, inventory purchase, supplier payment or an emergency fund.
A Commercial Line of Credit is the right choice if your business has larger working capital needs.
A business line of credit is a type of small-business funding that provides flexibility that a regular business funding doesn’t. With a business line of credit, you can borrow up to a certain limit — say, $100,000 — and pay interest only on the portion of money that you borrow
Speak to one of our qualified and seasoned Small Business Funding Managers to better understand what funding options and approvals we have for your small business.
| FUNDING TYPES | MAX AMOUNTS | RATES | SPEED |
|---|---|---|---|
| Merchant Cash Advance | $7.5k – $1m | Starting at 1.09 | 1-2 business days |
| SBA Funding | $50k-$10m | Starting at 5% | 3-5 weeks |
| Business Term Funding | $10k to $5m | Starting at 5% | 1-3 business days |
| Business Line of Credit | $10k to $250k | Starting at 8% | 1-3 business days |
| Receivables/Invoice Factoring | $50k-$10m | Starting at 5.8% | 1-2 weeks |
| Equipment Financing | Up to $5m per piece | Starting at 5% | 3-10 business days |
| Revenue Based Business Funding | $10K – $5m | Starting at 9% | 1-3 business days |
Ready to start a partnership? Then let’s talk about opening a line of credit for your business. At First Down Funding, we’re here to help your business thrive. Contact us today to get started with your free assessment. Also, please feel free to give us a call or shoot us an email. We look forward to working with you!
The process to qualify for a line of credit will depend on the requirements of individual funders themselves, but there are some common standards. The following are crucial to qualifying for a good line of credit with good terms:
**Based on past customers
Annual Revenue
Credit Score
Time in Business
The four major differentiators between funders and products are the following:
First Down Funding offers online application that can be easily filled out within minutes. If you still have questions, call us at (866) 644 1353 or click here for more contact options. We’ll be ready to answer any and all questions on your product, our job is to help making filling out the application easier.
Pay careful attention to what you use your line of credit for. As stated above, you should use your line of credit for expenses that will genecost of working capital a quick return. In a perfect world, you’d pay off your balance immediately after you use your credit to avoid fees. Usually, the bulk of fees will come from usage or interest fees on the credit that you use, so you shouldn’t feel pressured to use it. Also, pay careful attention to the repayment plan.
If you want to continue operating with your line of credit, good standing with your funder is crucial. Don’t make late payments, otherwise your funder may not renew the line of credit with you or may increase the fees and reduce the credit limit. On the flipside, if you always make your payments on time and use your credit enough to show that you’re a reliable customer, you may get your credit line increased and fees reduced.
Contact First Down Funding for all funding options.
Business credit cards are best suited for frequent everyday business expenses. Credit cards are structured with lower credit limits and high fees. However, they’re also the most liquid form of credit a business can use, making them ideal for daily expenditures. For example, if you’re looking for a financing option to buy office supplies on a regular basis or take out clients week to week, credit cards are the right option.
Business lines of credit are best used for larger ongoing expenses like marketing campaigns or longer term projects. Business lines of credit are typically much larger than the credit limits of credit cards, and borrowers typically only need to pay interest when the line of credit is used compared to a term funding where borrowers pay interest and fees whether the financing is used or not.
Funding of all kinds are typically best for larger and infrequent business expenses. Funding differ from credit cards and lines of credit, given that they’re typically issued as a lump sum source of financing. As funding aren’t revolving, there is a finite limit to how much you can finance, so we recommend you have a good sense of how much you’re looking to spend before applying for a funding. If you apply for a funding, you’re going to have to pay back your principal amount with interest and fees attached. If you want to buy a new office space or spend money on a large, one-time expense that you feel will genecost of working capital enough revenue that exceeds the debt, a funding is the right option.
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