How Does a Line of Credit Work?
A line of credit is an agreement between your company and North Shore Bank that allows your business to borrow up to a specified maximum amount, and until the maturity of the note, to repay the loan as your cash flow permits. Any payments by your business prior to maturity makes it possible for your company to borrow additional funds equal to the sum of those payments. A line of credit works much the same as a credit card for your business, but typically with a higher maximum and at a better rate. When your line of credit matures, the bank will review your company’s updated financial information, payment record and line-of-credit usage. We will then work with you to determine how you can best benefit from the credit you have established. Together, well decide whether your line of credit should be renewed, repaid in regular monthly payments or repaid in a lump sum payment.
