We’ll delve into how this funding option works, the pros and cons, eligibility criteria, and their potential impact on your startup’s financial health. Additionally, I’ll provide actionable advice on choosing this funding option for your needs and growth stage, supported by real-life examples and data.
A Secured Line of Credit (SLOC) is backed by collateral, such as real estate or inventory. It offers lower interest rates compared to unsecured lines of credit. Call us at (877) 381-4433
How It Works
You pledge assets as collateral, and in return, receive a line of credit. The lender can seize the collateral if you default on the loan.
Pros and Cons
Pros: Lower interest rates, higher borrowing limits, helps build credit.
Cons: Risk of losing collateral, requires valuable assets, potential for over-leverage.
Eligibility Criteria
Requires valuable collateral, a strong credit score, and a viable business plan. Lenders will assess the value of your assets and your ability to repay.
Impact on Financial Health
Provides low-cost funds but poses a risk to your assets if you default.