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Business Line of Credit Reviews

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  • Newtek Small Business Finance Review

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    Newtek is a direct lender that provides personalized solutions to fit the specific needs of each small business that seeks financing. Newtek is ideal for small businesses but be wary of their opaque rates and terms.

  • Guidant Financial Review

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    Guidant Financial is an alternative lender specialized in Rollovers as Business Startups (ROBS). They also offer SBA loans and lines of credit. Guidant is suitable for mature businesses with excellent credit.

  • Excel Capital Management Review

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    Excel Capital Management in an online lender offering unsecured business loans, business lines of credit, and other similar financial products. Their rates on unsecured business loans are reasonable but the line of credit fee structure can pile up the costs. Excel is not the most transparent lender

  • Fundwise Capital Review

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    Fundwise Capital is a financial service company that specializes in connecting qualified customers with third-party funders. For new entrepreneurs with good credit, Fundwise can make a significant impact, especially if you qualify for zero interest during your first year. Beware of being upsold on credit counseling.

  • Celtic Bank Small Business Loans Review

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    Celtic Bank is one of the biggest originators of SBA 7(a) loans and SBA 504 loans. It is one of the more accessible bank lenders out there when it comes to business loans, with less stringent requirements than most of its competitors. However, make sure you ask about their fee structure and interest rates before signing any papers.

  • Capital One Business Loans Review

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    Capital One Business Loans are short-term loans, lines of credit, and SBA loans provided by Capital One. Capital One lends to businesses located within its retail footprint. These loans aren’t the easiest to qualify for, but they do have better rates than you’ll find in most of the alternative market.

  • PNC Bank Small Business Loans Review

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    PNC offers small businesses loans or lines of credit to their business banking customers in the Mid-Atlantic, Southeast, or Upper Midwest. It is suited for small to large businesses. Even though their interest rates are low, PNC Bank Small Business Loans have stringent borrower qualifications.

  • LendingTree Business Loans Review

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    LendingTree is an online platform connecting individuals and businesses to a wide range of financial products through their lending partners. It has relaxed loan qualifications and ideal for new businesses. Be cautious of their non-transparent terms and fees.

  • National Business Capital Review

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    National Business Capital (NBC) is a lending advisory service that links small business applicants to one of its 75+ lending affiliates. It is suitable for startups, new, and mature-but-credit-challenged businesses. Be cautious that you’re unlikely to get the absolute best rates.

  • TD Bank Business Loans Review

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    TD offers short-term loans and lines of credit to small businesses. East Coasters with excellent credit and branches in their area can take advantage of TD’s origination fee-free loans if they’re seeking less than $100,000. Be aware of their stringent borrower qualifications.

What is a Line of Credit?

A line of credit is a business financing arrangement between a funder and a business. Much like a credit card, a line of credit provides businesses with a maximum borrowing amount. The business can draw up to the maximum amount at any time, and it only pays interest and fees on the amount borrowed.

Credit lines are often called revolving lines of credit because, when your outstanding debt is paid down, you will be able to borrow from the full amount again.

For example, you might have a line of credit with a maximum limit of $100,000. You borrow $10,000 and have a repayment term length of six months. At this point, you have access to $90,000. In two months, you borrow another $30,000, so your credit line is down to $60,000 and you have $40,000 in debt (minus what you have already paid). When you repay the money you owe, you will have access to the full $100,000 again.

Some lines of credit are not backed by collateral (or, at least, not specific collateral). However, a common type of line of credit is an asset-backed line of credit. These lines are backed by forms of business revenue such as invoices, inventory, and monthly recurring revenue. The maximum available credit normally corresponds to the value of your assets. Because your loan is backed by collateral, these types of credit lines normally carry lower fees than credit lines that aren’t backed by collateral.

Lines of credit are available from a number of different sources, including online lenders and banks. Check out our article to find the best business line of credit provider for your enterprise. 

Who Should Use a Line of Credit?

Because you do not need to reapply every time you need funds, a line of credit can be useful for a number of scenarios. If your business is in any of these situations, you may want to consider getting a credit line:

  • Your business has inconsistent cash flow
  • You frequently need cash to capitalize on unexpected opportunities
  • You need additional capital, but you don’t know exactly how much
  • You want a financial safety net just in case the need arises