Business Lines Of Credit - Best Option For Florida Businesses?
If you are a more established Florida small business owner with a personal credit score over 650 then yes.
Revolving Credit helps small business owners stay afloat during times when business is slow and cash is short. A business line of credit helps solve these problems quickly.
Revolving Credit is an easy way of borrowing money for your business. Instead of a loan that is given based on a fixed amount a revolving loan is much more flexible, it lets you borrow money in increments as needed over time as needed up to pre-approved limit. Payback is only on cash withdrawn.
A small business line of credit helps a business owner to borrow money to meet short term goals.This commonly used option to obtain the funds is securing a line of credit. Revolving credit can be a great cash management tool for your business.
The Definition Of Revolving Credit?
Most business owners use a line of credit to increase their working capital.This is a great way to get unexpected tasks done with the cash flow needed to get done.
Lines Of Credit are faster and more flexible than a small bank installment loan. This funding works best for short term expenses and purchases. Small Business revolving lines of credit are sometimes used to pay stuff like taxes, payroll, or really anytime there is a situation where cash is short and needed in the business. The way these loans are set up allows you to have it available in advance with the ability to withdraw and use it only when you feel you need it.
How Does Line Of Credit Work?
Its an arrangement between the lender and the business owner.The lender sets an approved credit line amount that the business owner can draw any amount he wants whenever he wants, but not to exceed the total amount of the credit line. The borrower doesn’t have to use the whole amount (and pay interest on) they were approved for.
Is A Revolving Line Of Credit Right For Your Business?
The short answer is Yes! Its always their to help business owners when there are unexpected expenses or shortfall of cash. It keeps the business operating normal while addressing these tasks. A revolving line of credit can help buy inventory or equipment if they want to expand and/or help cover operating expenses if for some reason cash flow slows down. Business lines of credit allows a business maintain consistency and helps them thrive and grow.
Lines of credit are most used for working capital, wherever it may seem fit. You apply for it once and its always there for you to use as needed.It gives the best flexibility to weather the gaps in cash flow.
Why A Line Of Credit Better Than A Small Business Loan?
A business can draw on the line of credit anytime. Interest is only charged on funds that are withdrawn.
Small Example Of How Revolving Credit Card Works?
A business owner encounters a plumbing problem in the kitchen of his restaurant and the cost to fix is $3000.00. The business gets approved for a traditional $30,000 business loan. On a traditional loan you would have to take full amount and pay interest on it from day one for the full amount even if don’t actually use all of the funds. With a revolving line of credit, you only pay for the funds you actually use. So in this example you would draw the $3000.00 from your account and just pay interest on the $3,000 instead of the $30,000. The more that’s borrowed the more you have to pay back. As you pay down what you owe your available credit increases.
Installment Loans Vs Revolving Credit
The payback on revolving lines of credits offer better flexibility than installment loans. Installment loans have fixed rates that are due on specific dates. Once a business has a revolving line of credit they can borrow whenever they want up to approval limit without having to reapply each time they need money.
Is It Hard To Get Revolving Business Line Of Credit?
No! You just need to call us today as you can pre-qualify right over the phone in minutes, call us at 407-269-8286
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Interesting Articles about Business Lines Of Credit
- nerdwallet.com – business line of credit: how it works and best options
- kabbage – what is a business line of credit used for?
- entrepreneur.com – how business owners can get fiscally fit in the new year