If you need financing to grow your business, American Direct Funding Business Line of Credit might be the solution for you! Get up to $5 million line amount and the expert support you need from start to finish.
Business Line of Credit.
American Direct Funding's Business Line of Credit is the perfect financing option for businesses of all sizes. With our Business Line of Credit, you can get the money you need as your business grows.
Get the Funding You Need, as Your Business Grows.
Applying will not affect your credit score
Guide to Business Lines of Credit
- What Is a Business Line of Credit?
- How Does a Business Line of Credit Work?
- How is a line of credit different from a business loan?
- Secured vs. Unsecured Business Line of Credit
- How You Could Benefit From a Business Line of Credit
- What Are The Advantages of a Business Line of Credit?
- Why choose American Direct Funding?
- What Do You Need to Be Eligible to Apply for a Business Line of Credit?
- Our Loan Application Process
What Is a Business Line of Credit?
A line of credit is a pre-agreed amount of money that you can borrow and pay back when you need it. Unlike a traditional term loan, you can use the funds for business purchases such as inventory, supplies, or operating expenses as needed. Unlike a term loan, which has a fixed monthly repayment, you can typically repay your credit line in full whenever you want, with no early repayment penalties.
The fact that lines of credit are “revolving” distinguishes them from term loans. That is, you can use the funds up to the amount approved, then repay what you’ve used to make the funds available again. Term loans, on the other hand, are lump-sum loans that you use once and then repay with interest.
How Does a Business Line of Credit Work?
Business lines of credit are similar to business credit cards in that they both allow small businesses to access funds as needed rather than receiving a lump sum from a business loan.
Business lines of credit typically have lower interest rates than business credit cards. Credit limits and interest rates are set by lenders based on factors such as the current owner’s tenure and the company’s annual revenue. A line of credit is typically renewed once a year.
Every small business needs to be able to adapt to change, especially in times of growth or uneven cash flow. When you need ready access to cash and flexible terms for repaying borrowed funds, a business line of credit can often be an ideal solution.
As you pay it down, you’ll be able to get more money. Rather than paying interest on the entire credit limit, you’ll only be charged interest on what you use. You may be charged a non-utilization fee or be required to pay for the line if you don’t use it, depending on your lender. Before you sign anything, make sure you get all of the details on any fees. Any agreement that lacks clear, transparent information should be avoided.
Applying will not affect your credit score
How is a line of credit different from a business loan?
A line of credit is different from a traditional loan because you don’t have to use it. Instead, you can use it as a buffer or back-up plan if you run into cash flow problems due to clients who don’t pay on time, expenses you didn’t expect, or even just seasonal changes.
The biggest difference might be that a business loan is taken out only once, for a specific reason, and before you need it. On the other hand, you can get a line of credit before you need it and use it more than once for day-to-day things like paying bills, buying inventory, replacing a broken piece of equipment quickly, marketing, making payroll, etc.
With American Direct Funding Business Line of Credit, you can get the financing you need in 1-3 days and be back to business. Our knowledgeable Business Financing Advisors can help answer your questions and explain your options so you’re well on your way.
Secured vs. Unsecured Business Line of Credit
There are two main types of business lines of credit: Secured and Unsecured.
Secured business line of credit: With this option, the lender requires the borrower to put up his or her own assets as collateral for the loan. Since this is a short-term debt, the lender may be willing to take inventory or accounts receivable as security. They probably won’t ask for big things like property or equipment. If the business don’t pay back the business line of credit loan, the lender will seize the collateral.
Unsecured business line of credit: Most business owners who want a line of credit choose this option because the lender doesn’t need any assets as collateral. Lending money without collateral is riskier for the lender, so to have a chance of getting approved, you usually have to meet a higher standard. To get approved, you will probably need to show that you have good personal credit, good business credit, and a history of making money. Most of the time, business lines of credit that aren’t backed by collateral have lower credit limits and higher interest rates.
How You Could Benefit From a Business Line of Credit
All businesses need money to keep going, but sometimes there isn’t enough working capital on hand when you need it. You might be waiting for a big client you really like to pay their bill, or you might need to buy a pricey new piece of equipment. Situations like these can have a big effect on your cash flow and even put your business at risk.
But if you have a line of credit, you can handle these problems with confidence, knowing that you can get the money you need.
A business line of credit is often used as a tool to help the business grow and do more, faster.
For example, a credit line can come in handy for things like:
Growing Your Business
Start up your business and pay for the costs of hiring more people, paying them, adding new jobs, and more.
Operational Costs
Keep cash on hand at all times for rent, utilities, and other costs that your business needs to pay every day.
Marketing Expenses
By adding more marketing campaigns to the mix, you can bring in more business and take on more customers.
Seasonal Fluctuation
Obtain the funds you need to keep your business going when business is slow due to seasonal changes.
Stocking Up
Buy more stock or supplies to take advantage of busy times or new opportunities.
Wage Costs
Keep a pool of money to cover wage costs, especially if your facing cash flow shortages.
What Are The Advantages of a Business Line of Credit?
Genuine Line of Credit: Access the cash you need, whenever you need it.
Pay for What You Use: Don’t borrow more than what you need at a time.
Instant Funds: Unlock new opportunities & never turn away potential business.
Why Choose Us?
When you need cash for your growing or struggling business, it needs to be flexible and personalized. We look beyond credit and offer a customized loan that gives you the cash you need when you need it.
Applying will not affect your credit score
How American Direct Funding Works
01
Apply Online
Provide us your basic business information and get approved in as fast as 5 minutes.
02
Review Approved Terms
Review your approved options. After funding options selected, funds are deposited into your business checking account.
03
Make Payments
After payments made on time, you can renew or refinance your business line for more money and lower rates.
Real Success Stories. Real Customers.
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HAVE A QUESTION?
For more information, contact one of our friendly and knowledgeable financing experts today. Give us a call today at:
855-955-4921 OR
714-502-0523
