Short answer: Draw on your line when the money is coming and timing is the problem, or when spending now will clearly bring in more later. Avoid using it to cover ongoing losses you don’t have a plan to fix.
Good times to draw
- Timing gaps: payroll is due and customer payments are a week out
- Opportunities: a supplier discount, a bulk order or a big job
- Emergencies: equipment breaks and every day down costs money
- Seasonal prep: stocking up and staffing before your busy months
Times to think twice
- Covering losses month after month without a plan to turn things around
- Paying for personal expenses, which isn’t allowed and can cause problems
- Drawing your full limit “just in case” when you don’t need it yet
Want to see what your business qualifies for? Answer a few quick questions or call (888) 707-0202.
A simple rule
Before you draw, ask: “How will this get paid back, and when?” If you have a clear answer, like an invoice that clears in three weeks, it’s probably a good use.
Pay it down when you can
Paying down what you’ve drawn frees up your limit for the next time you need it.
Talk to your advisor
Your Flex Credit Capital advisor is happy to talk through whether a draw makes sense. That’s part of the job.
