How a business line of credit works
Business Line of Credit
$10,000 – $750,000
- 1+ month in business
- $17,000+ monthly revenue
- 551+ credit score
Typical requirements. Individual lenders set their own criteria and availability differs by state and industry.
A line of credit is an approved limit you draw against when you need it. Repay what you drew and the limit becomes available again, the way a credit card works but with cash and usually better rates.
You pay interest on the balance you are carrying, not on the full limit. A line sitting unused costs little or nothing, depending on the lender.
That makes it closer to a safety net than a loan. Plenty of owners open one before they need it, precisely so it is there when they do.
When it suits
- Uneven cash flow where the gap is a timing problem, not a shortage
- Having funding available without drawing it down today
- Recurring short-term needs: stock, a payroll gap, a slow season
What to watch for
- Revenue requirements are higher than for an advance. Most of our lending partners want to see around $17,000 a month.
- Some lines carry a maintenance or draw fee even at a zero balance. Ask what it costs in a month where you draw nothing.
- A lender can reduce or withdraw a line, so treat it as a buffer rather than a guarantee.
Common questions
What are the requirements for a business line of credit?
Among our lending partners, roughly one month in business, about $17,000 in monthly revenue, and a credit score from 551. Requirements vary and each lender sets its own.
Do I pay interest if I do not use it?
Generally not on the unused portion, though some lenders charge a maintenance fee regardless.
How is this different from a term loan?
A term loan is one lump sum on a fixed schedule. A line is a limit you draw against repeatedly, paying interest only on what you have taken.
See whether this fits your business
A few questions and we will match your answers against what each lending partner requires. Two minutes, and checking will not affect your credit score.
US Loan Portal is not a lender and does not make credit decisions. We provide information and introduce business owners to third-party lending partners. All funding is subject to lender approval, and amounts, rates, and terms are set by the lender. Ranges shown are typical and not an offer of credit.
Find out in two minutes
A few questions, no documents, and nothing happens to your credit score.
Checking won’t affect your credit score.