Typical terms of lines of credit?

by a searcher from Princeton University

3 years ago

I know an owner that has quality (blue chip) customers but working capital is problematic.

What are the typical terms for a line of credit? Origination cost? Personal guarantee? Fee on unpulled line? etc.

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lender from University of California, Berkeley - Haas School of Business

Depending on business, we can do 85% A/R, 65% inventory.

3 years ago | like reply | 1 like

searcher from IE Business School

If you don't need more than $350k I'd suggest looking at an SBA 7(a) express LOC. You'll probably have to PG but it's a simple revolver with no fee on the undrawn amount, low origination/packaging fee ($1k), & many banks will offer an "unmonitored" line which allows you to draw up to the full amount for any short term reason you need even without the A/R to back it up.

3 years ago | like reply | 3 likes

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