Need financing flexibility?
A business Revolving Line of Credit may be the answer.
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A line of credit can ease temporary cash shortfalls. It
can help make sure you're ready to finance needs like
rapid growth, restocking inventory, seasonal or volume
purchases, and taking advantage of trade discounts.
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Loan types: |
Fully-secured |
Loan amounts: |
$500,000 to $30 million. |
Collateral: |
Accounts receivables, inventory, machinery & equipment,
real estate |
Terms: |
1 – 3 years |
Interest rates: |
Floating rate of Prime + |
Industries: |
Manufacturing, wholesale, distribution and service
companies |
Sales Volume: |
Companies with annual sales of $5 million to $100
million |
Geography: |
United States |
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"Call us today to
see if a Line of Credit is right for
your business. No pressure . . . just my sincere effort
to help you."
Diane Homa,CCFC
Tollfree:(800) 663-7517
Phone: (727) 573-5533
Fax:(727) 299-9034
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Revolving lines of credit are structured as either asset-based or
cash-flow. Both cash-flow and asset-based structures offer their own
unique advantages for those seeking corporate financing.
Cash Flow vs.
Asset-based considerations
Cash Flow revolving loans
are better suited for companies with stable cash flow trends and
generally require more consistent operating history. While a
cash-flow loan requires less reporting than an asset-based loan, the
credit available is capped by a leverage multiple, and it typically
carries a higher interest rate margin. Cash-flow based revolvers
have less reporting, but they also have more covenants, the
violation of which can result in additional fees or termination of
the loan. The size of such a loan will generally be limited to a
multiple of the company's EBITDA (earnings before interest, taxes,
depreciation and amortization). In the current environment, that
senior debt multiple will cap out at about two to three times EBITDA.
Asset-based revolving loans
may be better suited for companies with cyclical cash flow, or
negative cash flow trends - though many profitable companies utilize
an ABL structure because of the reduced covenants package. An
asset-based revolver is designed for higher-leveraged borrowers that
experience considerable variation in their cash-flow performance and
need to maximize their working capital.
Borrowers are allowed to draw and repay as their cash cycle
dictates, up to the approved amount of the account, throughout the
term of the loan. An asset-based loan may also offer greater
borrowing leverage than a cash-flow structure because it is based on
the value of receivables, inventory, equipment and other assets,
which means that a company's borrowing ability will no longer be
tied to just its cash flow. In an ABL transaction, borrowing
capacity is tied to the underlying value of the firm's assets… value
that might otherwise never be tapped.
Learn more about
Asset-based loans.
Contact us today to discuss if a Line of Credit is appropriate
for your business.
(727) 573-5533 or Toll free (800) 663-7517
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