Business lines of credit often have more flexible repayment terms than a standard business loan. Business loan payments are typically fixed over the repayment period, while business lines of credit can offer interest-only payment terms, or outstanding balances can be repaid using a variety of repayment strategies. Companies with uncertain or fluctuating revenue streams, such as startups or seasonal businesses may benefit more from the flexible repayment terms a business line of credit offers.
Business Loan or Line of Credit?
Business Loan or Line of Credit
Monthly Payment |
Interest Paid |
Other Costs |
|---|---|---|
| $ 564.76 | $ 3,885.81 | $ 250.00 |
Monthly Payment |
Interest Paid |
Other Costs |
|---|---|---|
| $ 900.00 | $ 4,584.28 | $ 500.00 |
| Year | Loan | Line of Credit |
|---|---|---|
| 0 | $ 30,000.00 | $ 30,000.00 |
| 1 | $ 24,572.01 | $ 22,077.13 |
| 2 | $ 18,871.99 | $ 16,246.66 |
| 3 | $ 12,886.31 | $ 11,955.99 |
| 4 | $ 6,600.66 | $ 8,798.46 |
| 5 | $ 0.00 | $ 6,474.83 |