| Small business lines of credit are very important | | | | money back. It also provides them with the |
| tools for small business owners to utilize. As your | | | | knowledge that the owners of the business have |
| business grows, the need for additional funds | | | | the confidence in the quality and management of |
| grows; lines of credit provide ready cash to help | | | | the enterprise to invest even more of their |
| you meet short term funding needs, such as | | | | personal assets to guarantee its success. |
| increasing inventory, dealing with seasonal cash | | | | Once a business has been in operation over two |
| flow issues, or taking advantage of unexpected | | | | years there are more options to qualify for a |
| opportunities as they come along. | | | | small business line of credit without using your |
| Lines of credit help a business continue to operate | | | | personal credit. That's because the business has |
| and provide service to their customers and clients. | | | | gotten over that two year invisible barrier that |
| Being able to get a small business line of credit is | | | | traps so many others and it is a sign to the |
| a signal to both the ownership and customer base | | | | lending institutions like banks and credit unions that |
| that the business is well run and has the | | | | the business is being managed and operated |
| confidence of the banks and other lenders. | | | | properly. These banks issuing this type of credit |
| Getting a small business line of credit is very | | | | line are rare but do exist. |
| difficult for many small businesses in the early | | | | This allows a small business to pay its bills even |
| days of their operations. That's because the | | | | faster by letting them access funds before their |
| survival rate for them is simply not very good | | | | customers pay their invoices. It lets them smooth |
| during this period of time and many good business | | | | out any rough edges in their cash flow system |
| ideas are not able to generate the income or | | | | and ensures that however bad business may be |
| customer base that can allow them to make it | | | | in the short term that they can survive over a |
| through this tough start up period. | | | | longer period of time. It can also be used by the |
| In order to get this during this period it is often | | | | business to purchase or restock additional |
| necessary to provide a personal guarantee or | | | | inventory, buy new equipment, and even pay for |
| provide the banks with collateral or assets to | | | | some long term capital expenses that it would not |
| secure the small business line of credit. That gives | | | | be able to do under its existing financing |
| the lending institution an assurance that whatever | | | | circumstances. |
| happens with the business they will get their | | | | |