There’s no question that one of the biggest problems facing small businesses is positive cash flow. Many companies are obliged to wait for incoming revenues which are remitted by slow-paying customers, who may have been invoiced 30, 60, or even 90 days ago. At the same time, your small business must pay all its expenses regularly in order to avoid getting a poor credit history rating and possibly ruining your chances of obtaining loans in the future. One of the best ways you can keep your business running smoothly and filling in the gaps caused by intermittent cash flow is by obtaining business lines of credit.

How Business Lines of Credit Can Help

When you have a business line of credit, you can use it for expenses that have to be paid on time such as payroll, monthly office rent, or a number of other recurring expenses. Your business line of credit can also act as a safety net against unexpected expenses that pop up, and which you are obliged to somehow cover. The beauty of having a business line of credit is that as long as you can keep repaying the money you have withdrawn, you will always have a balance available to you to cover the next major expense which isn’t covered by incoming revenue.

Types of Business Lines of Credit

There are basically two types of business lines of credit, secured and unsecured. As you might guess, most businesses would prefer to establish an unsecured line of credit that does not require collateral being offered as a basis for the service. Unsecured lines of credit are more difficult to obtain, and your business will generally need to have a stellar credit history to get one. A secured line of credit is easier to get from a lender, but it means you’ll probably have to put up some form of collateral in order to secure one. That means if your business should fail and you default on the loan, the lender would be able to seize the collateral you offered, and sell it to cover their losses.

Does Your Company Have a Cash Flow Problem? 

If so, we may be able to assist you at Impact Commercial Capital. Contact us at your convenience to discuss with our financial experts some options for relieving the stress on your cash flow, and helping you get on a sounder financial footing.