If you find yourself looking for Fast Small Business Loans, a Revolving Line of Credit just may be the answer.
Owning a business often comes with challenges, including issues with cash flow and other unexpected hurdles. The appeal of a business line of credit is that it can be used for many different purposes. From unexpected expenses to covering payroll and supplier fees when revenue falls short, the flexibility offered by this type loan helps keep your company afloat in tough times. This can help small business owners secure funds to cover immediate needs.
A business line of credit is a flexible form of financing that businesses can access as needed. A line of credit is usually revolving, meaning that you can tap into it repeatedly, as long as you haven’t hit your credit limit. Once you secure your line of credit, you will need to pay back the amount you draw on (plus interest) within a predetermined repayment period. You could also pay back the amount immediately to save on interest. It is different from a loan because you don’t have to use it, but you can use it as a buffer or a fallback option if you have unexpected cash flow issues. They can also be a great way to start building or bolstering your business credit score.
In many ways, a business line of credit is similar to a business credit card. However, you can transfer money from your line of credit directly into your bank account, whereas with a credit card, a cash advance will likely come with hefty fees. Plus, credit cards tend to have higher APRs and shorter repayment terms.
For startups, a line of credit can help get your business off the ground, as many new businesses have limited capital needs, and a loan can quickly eat into your profits. For businesses that are already on their feet, a credit line offers a safety net, as well as great flexibility that business owners can use creatively to their advantage.
There are countless ways these funds could help your small business. You can use your revolving line of credit to help with cash flow management, marketing costs, building improvements, disaster recovery, unexpected opportunities, repairs and maintenance, to purchase inventory and equipment, and anything else you can think of.
In order to meet minimum requirements and get approved by lenders, who typically ask for information such as this, you should be prepared with the following qualifications:
- Personal credit score: Ideally 660 or higher
- Annual revenue: $25,000 or higher
- Time in business: Ideally six months or more
- Collateral: To secure your line of credit
- Current debt schedule: To determine if you can afford to pay back the line of credit if you draw from it
- Basic personal and business information: A form of identification and EIN
The above minimums are not all-encompassing. As with any line of credit, there is a significant amount of dialogue involved between the lender and the borrower during the assessment. However, if you meet these requirements, your chances of getting approved will be notably higher.
Most businesses, from large retailers to neighborhood mom-and-pop stores, can benefit from a business line of credit. It’s a tool that you can always have at your disposal but not draw on unless you need it. A business line of credit simplifies your life because it’s a revolving form of credit. Instead of borrowing a lump sum of money from the lender, you get access to a set amount of money that you can dip into, repay, and access again.
Here at iBank, this is our fastest funding program for quick business loans. Our Revolving Line of Credit or Working Capital Business loans provide you with the cash you need in record speed, giving you access in as little as 48 hours. Give us a call today!