Business Line of Credit — Flexible Funding You Draw As Needed
Last updated: July 2026 · By the LoanPro Advisor editorial team
A business line of credit is a pre-approved pool of funds — typically $25K to $250K — that you draw from whenever you need cash and pay interest only on what you use. Its biggest advantage over a loan: as you repay, the balance replenishes, so one approval covers many needs over time instead of one.
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How a business line of credit works
After approval, you receive a credit limit. Draw any amount up to that limit, and payments apply to the drawn balance; as you pay it down, that capacity becomes available again — like a credit card, but funded as cash to your bank account. Through our partner REIL Capital, decisions come within 24 hours, funds can be accessed on demand, and next-day funding is available.
Line of credit vs term loan
| Line of credit | Term loan | |
|---|---|---|
| Best for | Ongoing / unpredictable needs | One defined expense |
| How funds arrive | Draw as needed, up to your limit | Lump sum upfront |
| You pay on | Only what you draw | The full amount |
| Reusable? | Yes — balance replenishes | No — reapply for more |
| Typical size (via REIL) | $25K–$250K | Up to $250K short-term |
| Budgeting | Variable payments | Fixed payments |
Comparing against a lump-sum option? See business term loans or revenue-based financing at our sister site LoanSource Pro.
Best uses
- Cash-flow smoothing — cover payroll or rent while receivables land.
- Seasonal inventory — draw before your busy season, repay during it.
- Emergency cushion — approved capacity that costs little until used.
- Recurring project costs — fund each job's upfront costs, repay on completion.
Costs in plain English
You pay on drawn funds only. Pricing may be quoted as a monthly rate; always ask for the total payback amount on a sample draw, the fee schedule (draw fees, maintenance fees), and whether early repayment reduces cost. A LOC left undrawn is cheap insurance; a LOC maxed out permanently is expensive debt — if you need the full amount on day one, compare a term loan instead.
Qualification
- 6+ months in business
- ~$250K+ annual revenue
- 3 months of business bank statements
- 500+ FICO — checking options requires no hard credit pull
Line of credit FAQ
Should I get a term loan or a line of credit?
Choose a line of credit for ongoing or unpredictable needs — you draw only what you use and pay only on that. Choose a term loan for a single defined expense with a known cost, where fixed payments make budgeting easier. Many owners keep a LOC open as a safety net even after taking a term loan.
How much can I get with a business line of credit?
Through our funding partner REIL Capital, business lines of credit range from $25K to $250K, with terms of 6 months to 2 years, decisions within 24 hours, and next-day funding available.
Does an unused line of credit cost anything?
You generally pay only on what you draw. Some providers charge maintenance or draw fees, so ask your specialist to walk through the exact fee schedule before you accept an offer.
How is a business LOC different from a business credit card?
A LOC delivers cash to your bank account for any business expense — payroll, rent, suppliers — while a credit card is limited to card-accepting purchases and typically carries higher rates on cash advances. LOC limits also tend to be higher.
What do I need to qualify?
Generally about 6+ months in business, roughly $250K+ annual revenue, and 3 months of business bank statements. Checking your options involves no hard credit pull.
Open a line you can draw on anytime
$25K–$250K · Decisions within 24 hours · Next-day funding available
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