Lines of Credit
Working Capital
One of the problems with a traditional credit line is that it has a set credit limit you can borrow from once. For example, if you are approved for $50,000, you can borrow up to that amount in a single lump sum while beginning repayment on the total amount of the loan.
Working Capital lines, however, work in much the way that credit cards do. As you repay the balance, your available credit increases, and you can borrow from that credit line again.
A Working Capital LOC is ideal for companies that don’t want to pay the high-interest rates of a credit card. Rather than working with a huge credit card company, you’ll be working directly with the lender. This allows the borrower and the lender to form a professional relationship, which can lead to better terms and a higher available credit limit down the line. Our experienced team has access to a network of high-quality lenders that can help you hit your financing goals.
It’s not uncommon for a business to need a boost to their operational accounts from time to time.
However, borrowing money with a traditional commercial loan can be problematic, particularly if it is applied to assets such as building, equipment or stock on hand. In some cases, inconsistent cash flow can cause operational hardships, especially if you face unexpected expenses.
Fortunately, a line of credit (LOC) offers much more flexibility than traditional commercial loans. Our professional team has helped clients like you open both secured and unsecured lines. Credit lines enable you to withdraw as much or as little money as necessary when you need it. You’re only responsible for repaying what you use. You can pay down your balance and then borrow more as needed, up to your limit.
Credit lines are perfect for fluctuating expenses and can be an affordable financial safety net for your business. Contact our office for more information.
Unsecured Line of Credit
If your business has an excellent credit score and sales history, you may qualify for an Unsecured Line of Credit.
This means that you won’t need collateral to secure the loan. Unsecured LOCs present a low risk to the borrower, but a higher risk to the lender. Therefore, they tend to come with less generous maximum funding limits. Many lenders will charge higher interest rates to cover their risk in the absence of collateral.
Unsecured LOCs work well for companies that don’t want to leverage collateral but still want loan flexibility. Once you qualify, approval is generally swift, much faster than a traditional banking loan. If you’ve overestimated your needs, you aren’t responsible for the entire cost of the loan. Just take out what you need and leave the rest untouched.
Secured Line of Credit
A Secured Line of Credit is the opposite. These loans are tied to collateral, not like an unsecured loan. Because of this, lenders are more willing to offer higher limits. In some cases, you can borrow $1 million or more, provided that your business has a sufficiently high credit score and a solid history of repayment.
Another advantage of a Secured LOC over an unsecured account is lower interest rates. While these rates are not quite as low as a traditional commercial loan may be, they can save your business a lot over the long term, particularly when compared to credit cards. The underwriting process isn’t as restrictive as a traditional bank loan so, the terms can be more flexible and approval times significantly shorter.
If you have had trouble opening a line of credit in the past, give us a call. Our extensive network of lenders has enabled companies of all shapes and sizes to gain approval. We believe there’s an option for every business. Contact our professional team today.
Address: 885 Gold Hill Rd, Suite 454, Fort Mill, SC 29708
Call: 855-735-BRAC (2722)
Email: solutions@mbraccapital.com
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