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Georgia Business Line of Credit Options From Georgia-Based Community Banks.
How to use a business line of credit
A line of credit is a financing solution that allows a company to draw up to a predetermined amount of money. To get funds, you simply request a draw from the line. You can pay the line back at any time, which increases your funds availability. Most simple revolving lines of credit operate much like a conventional credit card operates.
Lending institutions restrict how you can use the line of credit. Obviously, since it is a commercial line, it can be used only for business purposes. Companies use these facilities to cover short-term needs such as paying suppliers, covering payroll, and handling other corporate expenses.
The cost of using a line varies based on the size of the line and the risk. The financing fee is paid on the outstanding balance. It is usually variable and tied to the prime rate. Additionally, lines may have other fees such as maintenance fees and availability fees. These fees vary by institution.
Lastly, many banks require that your company repay the full balance of the line every so often (e.g., every year). This practice, often referred to as “resting the line,” is something to keep in mind if you are considering this type of a product
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