Success Story - Business Line of Credit for Solar Industry - Amount $150K
Our customer was looking for a flexible business line of credit option which can allow him to use the funds on adhoc basis.
The customer shopped with few lenders directly (which caused multiple enquiries on his credit file) as well but was not able to find the optimum solution and that’s when they approached us.
Our lending specialist took the matters in his hands and started with a personal consultation to understand his business requirement in detail. To avoid any further credit enquiries on his file, our lending specialist started by getting 3 indicative offers within a couple of hours.
At Broc Finance, we pride ourselves in helping our clients. The client found one of the options very attractive which ticked all his boxes plus was saving him almost 5% p.a in interest costs against the offer he received directly from a lender.
What are the benefits of Business Line of Credit?
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FAQ's About Business Line of Credit/Business Overdraft
How do I use a business line of credit?
A business line of credit is similar to having a credit card limit. You would be approved a line of credit limit at the start of the loan. Once the limit is set, you can utilise part or full of the funds as required and pay it back whenever you wish. You would be charged interest only for the period of utilisation of the funds.
When should I consider a business line of credit over a business term loan?
A business line of credit could not necessarily be a right fit for any business. It all depends on the nature and term of funds requirement into your business. If your business has seasonal fluctuations in cash flow and you do not require the funds on an ongoing basis, a business line of credit would be right product for your business as you would have to pay interest only when you utilize the funds.
However, if a business has an ongoing requirement and you are likely to utilize the funds through out the year, a business term loan could be a better product as the borrowing costs may come cheaper as compared to a business line of credit loan. Please feel free o reach out to us on 1300 253 041 or send us a message in case you wish to know more.
What are cost of borrowing attached with a business line of credit?
A business line of credit may have the following borrowing costs:
Interest cost: Interest charged on the funds utilised.
Line fees: This is a small monthly/weekly/Annual fee charged by the lenders for facilitating you a line of credit throughout the term of the loan irrespective of your utilisation. This fee is charged on top of regular interest incurred on utilisation of funds.
Drawdown Fees: Some lenders may charge a small drawdown fees on each drawdown instead of line fees. This fee is charged on top of regular interest incurred on utilisation of funds.
How is the interest calculated on a business line of credit?
Most of the lenders calculate the interest on daily utilization basis and charge monthly to the accounts.
How much is the repayments?
Lenders may require you to pay the interest plus a percentage of the principal drawn on a weekly/fortnightly/monthly basis or simply amortize each drawing over a period of time (similar to term loan).
How long is the loan available for?
Generally, the term of a business line of credit range between 1 year to 5 years. Few lenders also provide a rollover facility at the end of the term.
What are the alternative business loan options to a business line of credit/business overdraft?
A business line of credit may not always be the right option for your business as you may have a fixed term loan requirement, or an instalment repayment structure would be more suitable to the cash flow of the business. There are various alternative business loan options which we can help you with. Some of the popular options are unsecured business loan, secured business loan, debtors finance and invoice finance facilities. Please reach out to us on 1300 253 041 or send us a message. One of our lending specialists would get in touch in no time to assist you.
How can Broc Finance help us?
At Broc Finance, we endeavour to get the most adequate facility suitable to the business requirements of our clients. In most of the cases logged in through us, we try to get an indicative offer from the lender for our client’s consideration before proceeding with formal application and consent to credit check. This approach helps our clients to avoid unwanted rejections and credit checks which can significantly impact their credit score.
We would be happy to answer, if you have any other questions. Please contact us.
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One of our lending experts would get in touch to discuss your loan requirements in no time.