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Line of Credit Clearance Levels & What Qualifies You for a Better Line of Credit


A line of credit represents a safety net for businesses that encounter a less favorable period from a financial standpoint, and an opportunity to find stability and growth for companies that are just now starting their activity. However, there’s a long way to go before you can actually get a line of credit. If you think this is what your business needs, there’s absolutely nothing stopping you from applying to any line of credit service you want. The tricky part is actually getting accepted. In case you needed more insight on how they determine your eligibility, check out these top influencing factors.


Credit score

Your company’s credit score is a universal parameter through which financial entities of all sorts are able to rank and evaluate your business. If you have a high enough credit score, you will be eligible to apply for a lot higher lines of credit. Depending on what lenders you are contacting, you might get different answers in regards to how high your credit score needs to be in order to qualify for their revolving credit.



Believe it or not, lenders aren’t really comfortable with lending their money to businesses that haven’t been around for a while. Most likely because there is little guarantee of a favorable outcome, most lenders tend to stay away from businesses that are literally just starting out. Most lenders will require that your company is at least 6 months old before you can firmly apply for a line of credit.



When you apply for a line of credit, you are basically asking someone for money. And just as if you would ask a friend for money, the difference between a “yes” and a “no” is most likely going to be the actually sum of money involved. As you can imagine, asking for smaller amounts of money will make lenders more likely to accept whereas going all out and asking for insane amounts of money will probably make lenders dismiss your business as a legitimate potential partner.



Your credit score is like a business card that recommends you in the world of business. The neat thing about it is the fact that you can make use of your connections in order to boost your credit score. You do this by asking your suppliers to report your activities to the central credit authority. Constant reports coming from noteworthy partners and suppliers will be like a big recommendation on your credit score “resume”. This means that the better your suppliers and relationship with other businesses are, the more likely it will be for credit line providers to formulate a favorable opinion about your organization.


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