When it comes down to opening up your own business or if you have one know, you’re probably wondering how you can get a line of credit and how much credit you’re going to get when you go out and apply for it. Well, I asked a few bankers and asked them this same question and this is what they told me.
When it comes down to opening up a shop, you can either apply for a loan or you can apply for a credit card. Each one is going to vary greatly when it comes to a limit. You may find that you’re going to only get a $6,000 credit limit with a credit card but with a loan, you can get up to $50,000.
Determining your credit line is going to depend on a few things. First and foremost, they are going to look at your credit score on your personal accounts. If this is bad, you can count on getting next to nothing. If you get anything, it’s going to have a high limit. The next thing they are going to factor in is your debt to income ratio. If you’re making $50,000 a year and have $150,000 in debt, there’s something wrong with this picture.
In the end, it’s going to come down to your credit score like anything and it’s also going to come down to the debt that you have. If you have next to no debt and your score is good, you can count on getting a great line of credit. Look at both business loans and credit cards and see what you can come up with.