How To Get A Business Line Of Credit

How To Get A Business Line Of Credit
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    Welcome back guys and thanks for joining me. Today we're going to talk about how
    to get a business line of credit. A
    business planning credit is actually one of the most sought after financing
    products by small business owners today. Everyone wants a business credit line. If
    you're looking to get a business credit line, a few things that are going to be
    important when applying and things that we're going to look at. One, we're goign to need
    a simple application and we're going to want to see that you've been in business
    for at least one year. We're not focused on real estate collateral where a lot of
    lenders are. Really going to want you to have some sort of hard asset or real
    estate collateral in order to issue you a credit line. We actually don't need
    that which is really cool and very helpful. We're really going to be focused
    on the most recent months cash flow in your business. We don't need to see
    millions of dollars of cash flow but we need to see at least 10 to 20
    thousand dollars a month in revenues. And we want to see that you're keeping a
    decent average daily balance in there and don't have multiple NSF or overdraft
    fees. That's going to be really important because again, we're not using any type
    of real estate collateral. Profitability on your tax return isn't necessarily
    necessary. And there's some different things that we'll look at and back
    things out on like depreciation and other expenses. But it's going to be
    important that you're going to have at least 3 to 6 months of your
    business bank statements together. Sometimes depending on the on the line
    side, if we start getting above 100/150 thousand
    we may need up-to-date or recent financials. We may need a tax return.
    There are some products that are under a hundred thousand where we don't need a
    tax return or any financials and it's a very simple and quick and easy process.
    Simple one-page digital application, 3 months bank statements and we can
    usually have you an approval within about 24 hours. Credit score wise. So, we
    have some credit line options that are available that with credit scores as low
    as about a 580 and that's kind of about the the lowest you can go to
    get a true revolving line of credit. We also have options available to people in
    the 700 credit score range as well too. So, there is a wide range of options
    available there's some different lenders that focus on different guidelines and
    criterias and depending on where you fall
    makeup which lender would make sense for you. Once, you have the application
    completed 3 months of bank statements, you'd be just about ready to
    be submitted into underwriting. But tip number one that I mentioned earlier
    which you would want to know is the credit line a true revolving line?
    Meaning that if you get approved for an example, $100,000 and
    you draw $40,000, that means you'd have $60,000 remaining. If you
    pay that 40,000 back that you used 2 or 3 weeks later, is that
    money available again? Some credit lines work once you draw that 40,000,
    you only have 60 remaining and you're on a repayment schedule for that
    $40,000. That can seem a little bit confusing. But someone on my team
    could help you, help explain in a little bit more detail with that. Tip number 1,
    is the credit line a true revolving line of credit? This is a very important
    question. Some credit lines are structured where you have the ability where
    you can draw money and repay. And that money becomes available again. And some
    credit lines work where you draw that money, it's not available again and then
    the remaining balance is only available. This is a really important question to
    ask and something that you definitely want to know because depending on how
    you're looking to use the line, that can be really important. If you're going to
    use it to purchase inventory and on the ongoing basis then you're absolutely
    going to want the line to be revolving. So as you borrow money and replenish it,
    it becomes available again. The other great thing about that is on a revolving
    credit line, once you replace it, you've only paid interest on the money that you
    used and for as long as it was outstanding. Which can be a huge money
    saver. So true revolving credit lines can really work great for any type of
    business or industry but they really work rate with people in the
    construction industry. When they get a new job they can have cash on hand to
    take on additional job so they have the money to buy materials and lay out for
    salaries and additional people that they might have to staff for that job. Works
    great for medical offices. If there's a slowdown in receivables, you can use it
    to fuel your payroll or work in capital in the practice. Great again for
    transportation companies. They can use it to... Transportation companies use it to
    bringing additional clients so they can have enough money to lay out all their
    upfront expenses like gas, drivers and things like that.
    Or if there's ever a slow in any type of payments, most people in the trucking
    business get do a job and then get paid 30 to 60 days later. So if there's
    ever a slowdown in those receivables, you have money on hand to keep your business
    and operations going. So, it's super important depending on what industry you
    are or how you're going to use that credit line to know if it's true revolving or
    when you pull the money. That's it. Great question to ask. Tip number 2, what are
    the terms of the line and does it reset? So meaning, a lot of lenders will give
    you a credit line which they give you the flexibility to pull and draw funds
    whenever you need it. Which is great but they want to check in with your business
    and make sure the business is still healthy.
    So typically, most lines will reset or go into a review every 12 to 24 months and
    it can vary from lender to lender. It's super important to know that and to make
    sure when that review is going to take place, what that review process is. Some
    review processes are very simple. Minimal paperwork. Some were a little bit more
    in-depth. But you really want to know what that review process is so when
    you're going to get the line, you could have that in the back of your mind. You
    keep it in mind for when that term is coming to do that you can have
    everything that you may need in order. And also make sure leading up to that
    that the business is in a great place and you know that that line is going to
    be eligible to renew. So that's really important. Tip 3, will the credit line
    grow with your business? It's a really good question to ask. If you're growing
    your business, most likely when most people are growing, they need even more
    money. So, you're going to really want to have to work with a lender that has the
    flexibility to work with you and to grow your line as your business grows. Great
    question to ask. A lot of... A lot of lenders do this. You know, some don't.
    Everyone has a different process around this. But it's a good question to ask.
    Does the line grow with you? And what would you need to do in order to
    increase your credit line? Another important thing is when you're going for
    a credit line, if you're approved for a larger amount, always take the larger
    amount. With most credit lines, you only pay for what you use. So even if you get
    approved for $200,000 and you only 50,000, take the $200,000 credit
    line. And only use 50. You only pay interest on the 50 but you have the
    ability and flexibility to have additional funds available if you may
    need it for any opportunities or challenges that
    could arise in the business. WSo we've been able to streamline the application
    process and minimize the documentation needed in order to get a business line
    of credit. We also have about 75 plus lenders on our platform and have
    provided about a billion in financing to small business owners all across the
    country over thousands of transactions. Depending on your industry, your needs
    there are a number of different credit lines out there. You really want to make
    sure that you work with the company that can provide multiple options back to you.
    And as mentioned, we have 75 lenders on our platform. What we'll do is a simple
    phone call, understand what you're looking to get accomplished based on
    your needs, based on your industry type and based on a few other criterias about
    yourself in your business. We'll make up the right lender in the right line for
    you. And we can help kind of sort through that and place you with the right
    lenders in order to get you the best line available on the
    market today. There's hundreds of lenders out there
    but there's only a dozen lenders that you really want to work with for a
    business line of credit. In the description below, we'll put a link to
    our website and we'll help you find a business line of credit that makes sense
    for you and your business. Be sure to subscribe and we'll see you tomorrow.
    Thanks for watching, have a great day.
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