Most business owners encounter lots of times when they need extra cash to smooth over gaps in cash flow. At times like these, you’ve probably considered how beneficial it would be to have a business line of credit. But how do you know when it’s the right time to apply for a line of credit? Here are some of the indicators which should make it clear that now is the opportune moment to apply.
Your Credit Card Isn’t Enough
While business credit cards can be very useful in their own way, they’re usually most advantageous when it comes to small, recurring expenses. A business line of credit is much more valuable when you need to meet larger expenses, and you require more flexibility. Credit cards will generally have limits on the amount of a cash advance you can take, whereas a business line of credit will generally allow you to take any cash advance up to the limit of your account.
You Constantly Need Fast Cash
When you frequently discover that you need a quick funding solution for some expense or other, that’s a pretty good sign that a business line of credit is what you really need. Taking a number of short-term loans, doing invoice financing, or possibly securing merchant cash offenses are all viable solutions, but when you find yourself doing them frequently, you’re better off with a business line of credit.
You’re Considering a Larger Future Loan
If you’re aware of a large expense upcoming in your future, you’ll probably need to take out a business loan to cover it. At least 20% of small business loans are disapproved because of poor credit on the part of the business. If you can take out a business line of credit and make your payments promptly, that will go a long way toward establishing good credit for your business and making you look more attractive as a potential borrower.
Looking for a Business Line of Credit?
We might be able to help you if you’re seeking a line of credit for your business. Contact us at Ambition Funding Solutions, so we can discuss your eligibility for a business line of credit.