What things are essential to your business operations? Most business owners would answer things such as a business location, equipment, and employees. Those things are important, but financing is equally valuable for keeping your company financially healthy. One of the most important tools for any business is a line of credit. Why are they so important?
Lines of Credit Provide Financing for Other Needs
A line of credit provides your company with a significant source of capital that you can use for virtually any business need. You can use it to take care of payroll, hire new employees, invest in new computers, upgrade your equipment, repair vehicles, and much more. In other words, having a line of credit gives you the means to take care of the other essentials for your company.
Do you need to repair equipment urgently? Your line of credit comes to the rescue. Do you have to pay property taxes for your business location or deal with increasing rent costs? With a line of credit, you’re never left without options. You can always hire the employees you need to provide the best customer service possible.
Lines of Credit Offer Flexible Repayment Options
Another huge benefit of a line of credit is the way you can manage repayment. True, the interest rates are higher with credit lines than long-term loans, so business credit is usually used for short-term projects. In any case, there are more options for payments with credit lines.
Instead of a fixed monthly payment that you have to meet without fail, you can take care of repaying a credit line differently. When you have a great month, you can pay off the main balance more quickly. In slow months, you can just make a minimum payment if needed.
You Have Total Control Over How You Spend the Money
Another benefit of lines of credit compared to other types of financing is the freedom they provide. With most loans, you have to give a detailed explanation of your plans for the money. You may have to use it the way a loan board approves. Sometimes, you even have to provide follow-up reports about the status of the loan.
With a line of credit, you don’t have to do any of those things. The money is there for you to manage and spend however you require. That makes it a powerful tool in a savvy entrepreneur’s hands. Contact Array Financial today to learn more about our unsecured lines of credit for both new and existing businesses.