Shop Around When Seeking A Line Of Credit

Online, March 25, 2011 (Newswire.com) - Whether you're trying to meet inventory demands, remodel your space or take care of any other short-term financial need, a line of credit or a business loan (http://www.americaoneunsecured.com/loans/BusinessLoan.aspx) is a great way to be sure you have extra funds available when you need them. Not unlike a credit card, you pay interest on the outstanding monthly balance only.

Many new business owners use personal lines of credit or personal loans (http://www.americaoneunsecured.com/loans/PersonalLoanMenu.aspx) in order to finance their companies when they're first starting out. However, once the business has made it through the initial growth phase, it would be in your best interest to apply for a business line of credit. Commercial lines of credit take the business owner out of the equation so that his personal credit rating is no longer affected by business transactions, and he's not putting up personal assets as collateral.

While business lines of credit are often more difficult to obtain, once you have one, you will leverage your buying and borrowing power. The key is to first build a strong business credit report. In order to make that happen, you need to register your company with the business credit bureaus and make sure to stick to their requirements. Then establish credit with the companies you do business with, and be sure to pay your bills in full and on time.

A good business credit rating and a sound financial history showing that your business has been profitable will often be good enough to get you started. Many business owners use the bank that holds their personal accounts because they already have an established relationship.

Lines of credit vary in how they're set up. Business lines are usually asset-based, and the interest rate can also differ, because commercial rates may be equal to or exceed the prime lending rate. So be sure to shop around.

A revolving line of credit can allow you to always have the cash on hand you need - and give you, as a business owner, peace of mind.