How does a line of credit differ from a term loan?

A term loan gives you a lump sum upfront that you repay over a set schedule. A line of credit gives you a limit to draw from as needed, and you only pay interest on what you draw.

How quickly can I access the funds?

Once established, some providers can transfer draws within 1-2 business days and some may be faster. Provider review, bank processing, and the agreement control the actual timing.

Do I have to draw the full amount?

No, you only draw what you need, when you need it. You can draw $5,000 from a $50,000 line if that's all you need.

Is collateral required?

It depends on the provider, credit limit, and business profile. Some smaller lines are unsecured, while larger or otherwise higher-risk facilities may require a lien, guarantee, or specific assets.

How is the interest calculated?

Interest is commonly calculated on the outstanding drawn balance, but the calculation method and billing frequency depend on the provider agreement.

Can I keep the line of credit open indefinitely?

Lines of credit usually have a set draw or renewal period. The provider may renew or review the facility after that period under its agreement.

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Line of Credit

Flexible funding you can draw from as needed. Only pay interest on what you use. Ideal for managing cash flow and seasonal fluctuations.

Maximum shown$500K

Draw Term6 - 24 months (provider dependent)

Interest Rate7% - 25% APR shown; quoted terms vary

Overview

A business line of credit provides flexibility that a regular business loan 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.

You then draw and repay funds as you wish, as long as you don't exceed your credit limit. It functions similarly to a credit card, but with access to cash instead.

Key Features

Revolving Funds

As you repay the borrowed amount, those funds become available to borrow again.

Pay Only What You Use

Interest is only charged on the funds you have actually drawn, not the total limit.

Quick Access

Once approved, some providers let you draw funds quickly; transfer timing varies.

Flexible Repayment

Weekly or monthly repayment schedules may be based on the drawn amount and provider agreement.

Cash Flow Support

Perfect for bridging gaps between receivables and payables.

Unsecured Options

Some lines are unsecured, while others require a lien, guarantee, or specific collateral.

Common Use Cases

Cash Flow Management

Smooth out uneven cash flow and cover operational expenses.

Seasonal Inventory

Purchase inventory ahead of your busy season.

Unexpected Expenses

Be prepared for emergency repairs or unexpected bills.

Marketing Campaigns

Fund advertising initiatives to drive new revenue.

Frequently Asked Questions

Loan Details

Credit Limit$10,000 - $500,000 (provider dependent)
Draw Term6 - 24 months (provider dependent)
Interest Rate7% - 25% APR shown; quoted terms vary
Time to FundOften 1 - 3 days after approval; varies

Common lender guidelines

These are common provider screening guidelines, not guaranteed minimums. Eligibility, credit standards, documentation, collateral, and final terms vary by provider.

6+ months in business is a common provider guideline
600+ personal credit is a common provider benchmark, not a universal requirement
$50,000+ annual revenue is a common provider guideline; thresholds vary
Providers commonly review consistent monthly deposits and cash flow

How to Apply

1
Submit 5-min form
2
Review matches
3
Provide documents
4
Receive funds

Timing expectations

After a completed application, quotes are typically provided within 24–72 hours. After acceptance, funding may be same day or within 24 hours, subject to provider approval, required documents, and bank processing.

SBA loans may take up to 60 days. All timelines are estimates and vary by product, provider, application, and banking process.

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SBA 504 Loan

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Working Capital

Fast, accessible capital to cover everyday business expenses. Short-term financing designed to keep your operations running smoothly.

More resources

Lines of credit guide Restaurants & hospitality funding Trucking & logistics funding

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