Lines of Credit (LOC’s) are another great option for small businesses that prefer to not pull out a loan. Unlike a loan, a line of credit allows you to withdraw funds when you require it and only what you need. A line of credit can also be thought of as a credit card. You may get approved for a certain amount and you may take out what you may need. As an example: You are provided with a line of credit for let’s say for $50,000 and you only require $10,000 for a small project. You may take out the $10,000 and pay back the interest on that amount, not the whole $50,000.
Also another benefits of a LOC is for services where the cost is not known. You are able to get the bill and take out the amount of what you need, once the cost is known. Also, some LOC are revolving, which as you make your payments the credit becomes available to you again. You have access to a fixed amount of capital and your funds replenish as you make your timely payments.
Input your search keywords and press Enter.