Funding option
Working capital when your business needs it.
A business line of credit may give you recurring access to funds instead of taking one large loan at once.
Terms card
Business line of credit
What it is
What it costs
What decides it
Who approves it
When it's the wrong tool
- You need one large lump sum for a single fixed purchase.
- Your bank has already offered you a cheaper line.
- The business is pre-revenue.
- The gap you are covering is a structural loss, not a timing gap.
How a business line works
A provider sets a credit limit. You draw part of it when you need funds. You repay what you drew, and that amount becomes available again.
Cost usually depends on how much you draw and how long you keep it out. Some providers also charge fees for opening the line, keeping it open, or making a draw.
When it may make sense
- Inventory
- Payroll
- Marketing
- Vendor payments
- Seasonal gaps
- Unexpected costs
Who this may fit
- Businesses with recurring, uneven cash needs rather than one fixed purchase.
- Owners who want funds available before they are needed, not after.
- Businesses with steady revenue and records that show it.
- Owners covering a timing gap between paying costs and being paid.
Who should think twice
- You need one large lump sum for a single fixed purchase, which a term product usually handles better.
- Your bank has already offered you a cheaper line, in which case compare the total cost before moving.
- The business is pre-revenue, and most providers review revenue and deposits closely.
- The gap you are covering is a structural loss rather than a timing gap, and borrowing will not fix it.
What providers may review
- Time in business
- Business revenue
- Cash flow
- Personal or business credit
- Existing debt
- Bank statements
- Industry
- State
Requirements vary by provider. We do not publish universal minimums, because there are none.
A line of credit is not always the cheapest choice.
Rates and fees vary widely by provider. Some online business credit is considerably more expensive than bank credit. Compare the total cost before you accept an offer, and keep your bank in the comparison.
Questions people ask
- How is a line different from a loan?
- A loan gives you one lump sum that you repay over a set term. A line lets you draw funds as you need them, repay, and draw again up to your limit.
- Do I pay for money I have not drawn?
- That depends on the agreement. Interest usually applies to what you draw, but some providers also charge maintenance or draw fees. Ask for every fee in writing.
- Will there be a credit check?
- Most providers review credit as part of underwriting. We will tell you exactly when a credit check happens, and whether it is a soft check or a hard one, before anything is submitted.
- Who decides the limit?
- The bank or funding provider does, based on its own underwriting. Soho does not set limits, rates, or terms.
- What does Soho charge?
- Soho Wealth Group is paid by the client, not by the bank or funding provider. The fee is a percentage of the amount actually funded — between 3% and 15%, depending on which product is used. The exact percentage for your situation is given to you in writing before you agree to anything.
Explore line of credit options.
Share a few details and we will talk through whether this path makes sense for your situation. No pressure, and nothing is submitted without your say-so.
Explore line of credit options.Compare other funding paths.
This may not be the right tool for you. Put all four funding paths side by side and compare what each one is, what it costs, and who decides.
Compare other funding paths.