Businesses can request funds at any time during the 12-month draw period, online or by phone (learn more). Draws can be requested from $500 up to the total amount of available credit and the business can request exactly what it needs. Requests are subject to review and approval, taking into account the business’ creditworthiness and other factors.
Will requesting funds impact my credit score?
Making a draw request won’t impact your personal credit score but may be reflected on the business’ credit report. Requests are subject to review and approval. Learn more.
How is the amount due calculated?
During the draw period, the amount due is 2% of the principal balance (what’s been borrowed) plus any fees and amounts that weren’t paid during prior statement periods.
During the repayment period, the amount due is the total outstanding balance at the end of the draw period divided into 26 equal payments that, if made in-full and on-time, bring the balance to zero over the next year.
Are there any fees?
If the business pays late, pays less than the amount due, or misses a payment, we may charge a late fee of $25 or 5% of the past due amount, whichever is greater.
A maintenance fee may apply during the 12-month draw period. Refer to the loan agreement or loan disclosure to see if this fee applies to your business' account. We'll waive the fee, if there is one, if 30% or more of the credit limit is in use as of 5:00 pm ET on the last day of the statement period. The maintenance fee does not apply to New York State businesses.
How is interest calculated?
We use the daily simple interest method, which means interest accrues every day on the drawn principal balance. The business only pays interest for the number of days that the balance is outstanding.
How does the business make payments?
AutoPay from the linked business bank account is required for the Business Line of Credit and makes it simple to stay on top of due dates. AutoPay automatically withdraws the amount due on the due date from the linked business bank account.
All Personal Guarantor(s) may make additional one-time payments by phone. However, the Authorized Representative (the individual who completed the line of credit application on behalf of the business) can also make one-time payments online.
How are payments applied? What gets paid first?
The business must pay the amount due for each statement period, which is applied first to maintenance fees, if any, then to accrued interest, then to the outstanding principal balance, and finally to late fees, if any. Additional payments in excess of the amount due are applied in the same way.
Will a one-time payment reduce the AutoPay amount?
AutoPay will take into account any one-time payments made prior to 5:00 pm ET on the due date of each statement period. If the amount due has been partially paid, AutoPay will withdraw the difference between the payment(s) received and the full amount due, to keep the business’ account current. If the amount due has been paid in full, AutoPay won’t withdraw another payment for that period.
After the Draw Period
What happens when the draw period ends?
When the draw period ends, the business is no longer able to request draws (learn more). If there’s an outstanding balance on the account, we divide the outstanding balance into 26 equal payments that, if made in-full and on-time, bring the balance to zero over the next year. The interest rate doesn’t change and payments are still due every two weeks. Additional maintenance fees are not applicable after the draw period.
Why would there be a balance at the end of the draw period?
In the draw period, the amount due is 2% of what’s been borrowed, plus fees, if any. These payments keep the business current and reduce the outstanding balance over the draw period, but may not pay it down to zero.
How does the amount due every two weeks change in the repayment period?
Payments are calculated differently and may be higher in the repayment period. In the draw period, the amount due is 2% of what’s been borrowed, plus fees, if any. When the draw period ends, we divide the outstanding balance into 26 equal payments that, if made in full and on time, bring the balance to zero over the next year.
Do the APR or payment frequency change in the repayment period?
The APR and payment schedule remain exactly the same as in the draw period. Payments are still due every two weeks and interest accrues at the same fixed rate.
How long will it take to pay off the outstanding balance after the draw period ends?
We’ll divide the outstanding balance at the end of the draw period into 26 equal payments, including interest and any applicable fees. Assuming all payments are made in-full and on-time, the balance will be paid off in 12 months. The business can always make additional payments to bring the balance to zero sooner, and there is no prepayment penalty.