Business Line of Credit — Revolving Capital On-Demand

Business Line of Credit at a glance

Typical amount

$10,000 – $500,000

Typical term

Revolving (12 – 24 month draw period)

APR

8% – 36% APR

Minimum time in business

6 months

Minimum credit score

580+

Common uses for a Line of Credit

• Ongoing cash flow
• Seasonal inventory
• Opportunity purchases

How LendWorks matches you with a Line of Credit lender

1. Apply in about two minutes — no credit-score impact.
2. Our AI underwriting engine grades your file and matches you with a dedicated advisor.
3. Your advisor presents vetted Business Line of Credit offers side by side — you choose or walk away.

Business Line of Credit FAQs

What is a Business Line of Credit?

A revolving business line of credit lets you draw funds as needed up to a set limit and only pay interest on what you use.

How much can I borrow with a Line of Credit?

Typical funding amounts range from $10,000 – $500,000. Your exact offer depends on revenue, time in business, credit profile, and business performance.

What are the rates for Business Line of Credit?

Business Line of Credit typically runs 8% – 36% APR. Your actual pricing depends on revenue, time in business, credit profile, and term — your advisor breaks down the real cost and total payback before you commit, so there are no surprises.

How long does it take to get funded with Business Line of Credit?

Funding timelines vary by product and lender — some options fund within a few business days, while larger or government-backed programs take longer. Your advisor gives you a realistic timeline for Business Line of Credit based on your documents and lender fit.

What do I need to qualify for Business Line of Credit?

Most lenders look for at least 6 months in business and a 580+ credit score. Your advisor will assess your full profile.

Is Business Line of Credit right for my business?

Business Line of Credit fits best when you need ongoing cash flow or seasonal inventory and can work with a Revolving (12 – 24 month draw period) term. If your timeline is longer or you can wait for a lower rate, your advisor may recommend an alternative — the goal is the right fit, not just the fastest approval.

How does LendWorks match me with a Line of Credit lender?

LendWorks runs your profile through AI underwriting to match you with a real advisor — not a lead form. Your advisor reviews your situation and presents options from our vetted lender network.

Does applying for Business Line of Credit hurt my credit score?

Checking your options with LendWorks does not impact your credit score. We use a soft pull to assess eligibility. A hard pull only occurs when you move forward with a specific lender offer.

Frequently asked questions

How does a business line of credit work?

When your line is approved, you receive a credit limit — say, $150,000. You can draw any amount up to that limit at any time, and repay it on a schedule set by the lender (often weekly or monthly minimum payments). As you repay principal, that amount becomes available to draw again. You only pay interest (and any draw fees) on the outstanding balance. Unlike a term loan, there is no fixed payoff date for the revolving portion — you manage the balance according to your business's needs within the lender's repayment requirements.

What is the difference between a secured and unsecured business line of credit?

An unsecured line of credit is backed only by your creditworthiness and personal guarantee — no specific asset is pledged. These are faster and simpler to obtain but come with lower limits and higher rates. A secured line of credit is backed by collateral — often accounts receivable (an asset-based line), inventory, or real estate (a HELOC or commercial real estate line). Secured lines offer significantly higher limits and lower rates. For most small businesses, the initial line is unsecured; as the business grows and establishes a track record, a secured asset-based line at a bank becomes the preferred long-term tool.

What is a draw fee and how does it affect the cost of my line?

Some lenders — particularly fintech and alternative lenders — charge a draw fee of 1–3% each time you make a draw from your line. This fee is separate from the interest rate and effectively increases the cost of capital. If you draw $50,000 from a line with a 2% draw fee, you receive $50,000 but owe $51,000 — plus interest on the outstanding balance. When comparing line of credit offers, always account for draw fees alongside the stated interest rate and any monthly maintenance or non-use fees.

How is a business line of credit different from a business credit card?

Both are revolving credit facilities, but business lines of credit offer substantially higher limits (up to millions vs. tens of thousands for cards), lower rates for qualified borrowers, and direct cash access without the 1.5–3% cash advance fee typical of credit cards. Credit cards offer rewards programs and purchase protections that lines of credit do not. For most businesses, the ideal setup is a credit card for everyday purchases and vendor payments (for rewards and float) and a line of credit for larger draws and cash flow management.

Can I use a business line of credit to pay employees?

Yes — a business line of credit can be used for any business operating expense, including payroll. Many businesses use their line specifically to cover payroll timing gaps, drawing when a large invoice has not yet been paid and repaying when the client pays. However, using a revolving line for recurring payroll without a clear repayment plan can lead to a permanently drawn-down balance, which is expensive. Lines of credit work best for short-term draws with a defined repayment event — not as a permanent payroll subsidy.

Does having an unused line of credit hurt my business?

No — an unused line of credit is a financial asset, not a liability. Having an available, zero-balance line of credit improves your liquidity position, can positively impact your business credit score, and gives you the ability to respond quickly to opportunities or emergencies. Most lenders do not charge fees for unused capacity, though some bank lines have annual maintenance fees ($150–$500/year) regardless of usage. The key is having the line established before you need it — applying for credit during a cash flow crisis is always harder than applying from a position of strength.

What happens to my line of credit if the lender reduces my limit?

Lenders periodically review lines of credit — typically annually at renewal — and may reduce your credit limit, change your rate, or close the line if your business performance has deteriorated. If your limit is reduced below your current outstanding balance, you will not be required to immediately repay the excess — you will simply be unable to draw until your balance falls below the new limit. Managing your line responsibly (not maxing it out, making timely payments) significantly reduces the risk of adverse line management by the lender.

How do I qualify for a higher business line of credit limit?

Credit limits for business lines are tied to monthly revenue, credit profile, and time in business. Most lenders cap unsecured lines at 50–100% of average monthly revenue. To qualify for a higher limit: increase and document your monthly revenue consistently over 6–12 months, improve personal and business credit scores, add a co-signer or additional guarantor, pledge receivables or inventory as collateral to convert to an asset-based line, or build a track record with your current lender by drawing and repaying responsibly before requesting a limit increase.