How to get a LINE of CREDIT to power through the volatility?

Financial markets are highly volatile, especially when there are economic challenges. However, due to this, the prices are constantly changing, and in this financial crunch, no business can make progress. It means you won’t be able to make money as a trader because sometimes there is more volatility than at other times. If you are a business owner, many of you have missed an opportunity due to a lack of capital. Businesses also struggle to pay bills on time due to a lack of money. So, in this situation, you get to know how frustrating cash flow problems can be. But the business line of credit works as a savior for these cash flow problems. If you want to get the advantage of this, then here is a good guide for your help:

What is a business line of credit?

A business LOC is a financing method like a credit card. However, with this facility, you get an opportunity to access a certain amount of cash that you can withdraw anytime. A business can withdraw the money if it doesn’t exceed the borrowing limit. Apart from this, you only need to pay interest on the amount you borrow. The business line of credit is better than a traditional small business loan in the following ways:

You don’t need to repay the amount after a specific period.
Businesses only need to pay interest on the amount that they borrow
The business line of credit is a more flexible borrowing method

Moreover, companies can use lines of credit for meeting short-term needs like cash flow management, buying inventory, or covering paystubs.

Get a business LINE OF CREDIT:

“The right time to apply for the business line of credit before you need it.”

(Ami Kessar)

There are many essential tools that every successful business needs. Apart from this, financing is also mandatory to grow. Out of all business loans, the LOC is one of the most flexible options, where you get a limit of a specified amount. However, here are the following reasons why a business should get a line of credit:

If your company has inconsistent cash flow	If the business is seasonal and you need money in the off-season
You need to pay for supplies and inventory	Pay for the supplies and stocks
For an emergency fund	If you need to pay for a project

So, it’s a good choice if you need cash fast, as it doesn’t require any application. The LOC comes in various forms regarding duration, grace period, interest, and security. So, if you want to get the advantage of this facility, do proper research before getting into this.

How to get a Business LOC? Step to step guide:

Earlier, we discussed that LOC is available in different forms and requirements. Each category falls into different categories, secured and unsecured. However, there are the following types that have their characteristics.

Types of LOC	Characteristics
A personal line of credit	Funds can be borrowed, repaid, and borrowed again Requires credit history of no defaults and credit score of 670>
Home equity LOC	Typically, the credit limit is 75%-80% of the home’s market value minus the amount owed.
Business LOC	You can borrow as per need instead of a fixed loan
Demand LOC	It’s rarely used
Securities backed LOC	The borrower provides collateral It lets investors borrow anywhere between 50%-95%

The most common types are business, home equity, and personal. But personal LOC is unsecured while others are available in secured and unsecured options. So, if you want to apply for the BLOC, then follow these steps:

Decide the type of LOC that you need:

Earlier, we discussed different forms and types of lines of credit. So, if you want to make a wise decision, read each in detail. The categories are designed according to different purposes for businesses. Apart from this, you should know the requirements to qualify for that specific LOC. Here are a few criteria for LOC:

A personal credit score of 500 will qualify for LOC, and if your CREDIT SCORE is more than 600 or 660, then you will be eligible for the most desirable LOC.
The minimum annual revenue should be between $25,000-$100,000. Apart from this, you need a bank statement, balance sheet, P&L statement, additional documents, and business & personal tax returns.
It would help if you had collateral as a security.
You can easily qualify for LOC if you have spent at least six months in business.

In addition, you need to provide a current debt schedule and basic personal & business information.

Assess whether you can qualify:

The borrowing health plays a vital role in deciding whether you will qualify for LOC or not. Usually, LOC is more complex than traditional term loans. However, if you want to qualify, then you should have min—of $ 25,000 of annual revenue. Apart from this, lenders look at the following factors to assess the repaying ability:

Credit score	How long have you been doing business	Business revenue
Collateral	Whether you have recent bankruptcies

In addition to this, the lender can ask for personal and business tax returns and other documents. They need all these details to check your financial health and borrowing capability.

Look for the LOC lenders:

The next step is finding a suitable lender to give you money. If you understand the requirements, it will be easy for you to search for the lender. There are different forms of lenders where you can apply for LOC:

Banks
Credit issuers agencies
Small business administration

Moreover, there are online lenders available that are ready to lend money if you meet their criteria.

Complete the application and apply:

After understanding everything, the final step is to complete an application and apply for the business line of credit. The application procedure depends on the type of lender for whom you are using. Many lenders offer an online application procedure, but sometimes, you may need to go to a physical location. You must fill out the form with basic information, business & personal tax returns, bank statements, personal ID, and balance sheets.

Conclusion:

After reading the whole text, it’s clear that the business line of credit offers many advantages to borrowers. But it doesn’t mean this model is perfect for all companies. It gives you financial peace of mind, money, and more credit. But it also comes with drawbacks like hefty fees, and this method could easily be abused. So, before applying, it’s vital to research whether it’s an excellent fit for your company or not.

This post may contain affiliate links. Financial Panther has partnered with AwardWallet and CardRatings for our coverage of credit card products. Financial Panther, AwardWallet, and CardRatings may receive a commission from card issuers. Some or all of the card offers that appear on the website are from advertisers. Compensation may impact on how and where card products appear on the site. The site does not include all card companies, or all available card offers. Opinions, reviews, analyses & recommendations are the author’s alone, and have not been reviewed, endorsed or approved by any of these entities.

More Recommended Ebike/Scooters

Check out these other ebikes and scooters I've reviewed:

Urban Arrow Ebike – Last year, I made one of the largest purchases I’ve ever made – I bought a $9,000 electric cargo bike from Urban Arrow. In my Urban Arrow review, I will discuss what it is and why I decided to buy this bike, as well as discuss how impactful a bike like this can be on your journey to financial independence.
Troxus Explorer Step-Thru Ebike – The Troxus Explorer Step-Thru is a fat-tire ebike that I’ve had the pleasure of riding for a while now. It has amazing power, great looks, and awesome range. If you’re looking for a great fat-tire ebike that offers a lot for the price, the Troxus Explorer Step-Thru is definitely one for you to consider. Check out my Troxus Explorer Step-Thru Review.
Hovsco HovBeta Ebike – The HovBeta is a folding ebike with great specs and a lot of interesting features, and importantly, it’s sold at a good price point. I’ve had a blast commuting with it and using it to do deliveries with DoorDash, Uber Eats, and Grubhub. Check out my Hovsco HovBeta Ebike Review.
Vanpowers Manidae Ebike – The Vanpowers Manidae is a fat tire ebike that I’ve been riding as my primary winter commuting bike and have also been using it to do food delivery with apps like DoorDash, Uber Eats, and Grubhub. After clocking in a decent number of miles with this ebike, I wanted to write a post sharing what my experience with the Vanpowers Manidae ebike has been like. Check out my Vanpowers Manidae Review.
Sohamo S3 Step-Thru Folding EBike Review – A Great Value Folding Ebike – The Sohamo S3 Step-Thru Folding Ebike is an entry-level folding ebike that offers a lot of value for the price point. I’ve been riding the Sohamo S3 for a while now, putting the bike through its paces, and I have to say, this bike has exceeded all of my expectations. Check out my Sohamo Review.
KBO Flip Ebike – The KBO Flip is an excellent bike. I’ve had a great time riding it and think it’s a versatile bike that can be used for a lot of purposes and can fit a variety of lifestyles. It’s worked out great for me as a general commuter bike and as a food delivery bike. Check out my KBO Flip Review.
Hiboy P7 Commuter Ebike – The Hiboy P7 is an excellent electric commuter bike that’s offered at an affordable price point. The range and speed of this bike are both very good, so you won’t have any trouble getting anywhere you need to go with it. As a food delivery vehicle, this is also good – with how much range it offers, you’ll be able to work all day on a single charge. Check out my Hiboy P7 Commuter Electric Bike Review.
Himiway Escape Ebike – The Himiway Escape is an interesting bike for anyone looking for a moped-style ebike. If you’re a gig economy worker, the Himiway Escape is particularly interesting and it’s possible to think of it as an investment, especially if you can opt to do deliveries with the Himiway versus using a car. It’s not cheap, but you can definitely make your money back when you compare the mileage you’ll put on your car versus using an ebike. Check out my Himiway Escape Bike Review.
Espin Sport Ebike – The Espin Sport is a good ebike for someone who is looking for an ebike that feels and rides more like a regular bike. There are many ebikes that are really only bikes in name. In reality, they’re basically electric mopeds. The Espin Sport, by contrast, is a bike you could probably ride without the battery and you’d feel like you’re just riding a regular bike. Check out my Espin Sport Review.
Varla Eagle One Scooter – The Varla Eagle One is an excellent scooter that can make sense for a lot of people. It can work as a primary mode of transportation. You can use it to work on gig economy apps like DoorDash, Uber Eats, and Grubhub. And it can also be a recreational vehicle if you’d prefer to use it for that. Check out my Varla Eagle One Review.
Varla Falcon Scooter – The Varla Falcon is an excellent scooter that offers a good amount of power at a lower price point compared to more powerful scooters. It’s not exactly an entry-level scooter, nor is it a high-powered scooter. I think it fits somewhere in-between those two categories – an intermediate scooter if I had to give it a category. Check out my Varla Falcon Review.
Hiboy S2 Scooter – The Hiboy S2 is an excellent entry-level commuter scooter that's perfect for someone looking to save some money in transportation costs and improve their commute. Check out my Hiboy S2 Review.
Hiboy S2R Scooter – The Hiboy S2R is one of the more interesting electric scooters I’ve been able to test out. It’s not a high-powered scooter, but for an everyday transport option, it’s very useful, especially given some of the unique features that it has. Indeed, for the price, the Hiboy S2R might be the best value scooter I’ve used. Check out my Hiboy S2R Review.
Fucare H3 Scooter – The Fucare H3 is a fun scooter and I’ve enjoyed testing it out. For a daily commuter or quick trips or errands, the Fucare H3 is probably the scooter I’ll use. It’s portable and easy to maneuver, so it’s just easier to take on the road when I need it. Check out my Fucare H3 Scooter Review.

More Recommended Investing App Bonuses

For additional investing app bonuses, be sure to check out the ones below:

M1 Finance ($100) – This is a great robo-advisor that has no fees and allows you to create a customized portfolio based on your risk tolerance. You also get $100 for opening an account. Check out my M1 Finance Referral Bonus – Step-By-Step Guide.
SoFi Invest ($25) – SoFi Invest is an easy brokerage account bonus that you can earn with just a few minutes of work. Use my SoFi Invest referral link, fund your SoFi Invest brokerage account with just $10 and you’ll get $25 of free stock. I also have a step-by-step guide for the SoFi Invest referral bonus.
Webull (20 free stock shares) – Webull's current promotion gives you 20 free shares valued between $3-$3,000 each if you open an account using my referral link. Here’s a guide I wrote about how to earn your free shares using Webull.
Moomoo (15 free stocks) – Moomoo is a free investing app currently offering 2 different referral bonuses if you open an account using a referral link. Read my Moomoo referral bonus guide for more information.
Robinhood (1 free stock) – Robinhood gives you a free stock valued between $2.50-$225 if you open an account using my referral link.
Public (1 free stock) - Public gives you a free stock valued between $3-$70 if you open an account using my referral link.

More Recommended Bank Account Bonuses

If you’re looking for more easy bank bonuses, check out the below options. These bonuses are all easy to earn and have no fees or minimum balance requirements to worry about.

Upgrade ($200) – Upgrade is a free checking account that’s currently offering a $200 referral bonus if you open an account and complete a direct deposit. These bonus terms are easy to meet, so it’s well worth doing this bonus as soon as you can. Here’s a post I wrote with more details: Upgrade $200 Referral Bonus – Step By Step Directions.
Ally Bank ($100) – Of all the banks out there, Ally is, without a doubt, my favorite. At the moment, Ally is offering $100 to customers who open an eligible Ally account and meet the requirements. Here are the step-by-step directions to earn your Ally Bank referral bonus.
Fairwinds Credit Union ($175) – Fairwinds Credit Union is offering a referral bonus for users that sign up using a referral link. Fairwinds has no fees or minimum balance, so this is a particularly easy bonus to earn. Since this is a smaller credit union, my gut instinct tells me this offer won’t be around long, so if you’re in a position to meet the bonus requirements, grab this bonus before it’s gone. Here is my step-by-step guide on how to earn your Fairwinds Credit Union bonus.
Chime ($100) - Chime is a free bank account that offers a referral bonus if you use a referral link and complete a direct deposit of $200 or more. In practice, any ACH transfer into this account triggers the bonus. This bonus is easy to earn and posts instantly, so you’ll know if you met the requirements as soon as you move money into the account. I wrote a step-by-step guide on how to earn your Chime referral bonus that I recommend you check out.
US Bank Business ($900) – This is a fairly easy bank bonus to earn, since there are no direct deposit requirements. In addition, you can open the Silver Business Checking account, which comes with no monthly fees. Check out how to earn this big bonus here.
GO2Bank ($50) - GO2Bank is an easy bank bonus that I recommend people take advantage of if they have an easy way of meeting the direct deposit requirement. I like that it’s easy to open the account and that the bonus pays out quickly. Check out my step-by-step guide on how to earn your GO2Bank $50 referral bonus.
Current ($50) – Current is a free fintech bank that’s offering new users a $50 referral bonus after signing up for an account using a referral link. Current is an easy bonus to earn and also gives you access to three savings accounts that pay you 4% interest on up to $2,000. That means you can put away up to $6,000 earning 4% interest. That’s very good and makes Current an account I recommend to everyone. Check out my step-by-step guide on how to earn your Current Bank bonus.
Novo Bank ($40) - Novo bank is a free business checking account that’s currently offering a $40 bonus if you open a Novo business checking account using a referral link. In addition to being a good bank bonus, Novo is also a good business checking account. It has no monthly fees or minimum balance requirements and operates a good app and website. Indeed, it’s the business checking account I currently use for this blog. Check out my post on how to easily open a Novo account.
Varo ($25) – Varo is a free fintech banking app similar to Chime or Current. It’s currently offering a $25 bonus to new users that open a new Varo account with a referral link. The bonus for this bank is very easy to meet, all you need to do is spend $20 within 30 days of opening your Varo account. Check out my step-by-step guide to learn how to earn this bonus.

Kevin is an attorney and the blogger behind Financial Panther, a blog about personal finance, travel hacking, and side hustling using the gig economy. He paid off $87,000 worth of student loans in just 2.5 years by choosing not to live like a big shot lawyer.

Kevin is passionate about earning money using the gig economy and you can see all the ways he makes extra income every month in his side hustle reports.

Kevin is also big on using the latest fintech apps to improve his finances. Some of Kevin's favorite fintech apps include:

SoFi Money. A really good checking account with absolutely no fees. You'll get a $25 referral bonus if you open a SoFi Money account with a referral link, and an additional $300 if you complete a direct deposit.
5% Savings Accounts. I'm currently getting 5.24% interest on my savings through a company called Raisin. Opening a Raisin account takes minutes to complete, it's free, and all of your funds are FDIC-insured. I explain how it works, why I'm now using it to store my emergency fund and any other cash savings I have, and why I recommend everyone check it out in this review.
US Bank Business. US Bank is currently offering new business customers a $900 signup bonus after opening a new account and meeting certain requirements.
M1 Finance. This is a great robo-advisor that has no fees and allows you to create a customized portfolio based on your risk tolerance. You also get $100 for opening an account.
Empower. One of best free apps you can use to monitor your portfolio and track your net worth. This is one of the apps I use to track my financial accounts.

Feel free to send Kevin a message here.