Business line of credit: plain-English answers
A business LOC is the flexible middle ground — draw when you need it, pay interest only on what's drawn. Here's how they actually work, what it takes to qualify, and how they affect your credit.
How a business line of credit fits your cash flow
A line of credit is best for repeating, short gaps: buying materials before a job pays, covering payroll in a slow month, or restocking inventory. You draw what you need, repay it, and draw again, paying interest only on what you use.
It is usually cheaper than a merchant cash advance but harder to qualify for. Lenders look at revenue, time in business and credit, and many prefer 12+ months of history. Through Outset Funding you need $10,000+ in monthly revenue and 6+ months in business; approval and terms are set by the lender.
If you need a single lump sum for a purchase, a term loan or equipment financing is usually the better fit.