A line of credit only costs money on what you draw. Enter a draw amount, rate, and payoff timeline to see the estimated monthly payment and total cost, plus what the same draw costs per month if you pay interest only.
Estimate only. Assumes one draw paid down on a fixed schedule; many lines are interest-only until you pay down principal, and some charge draw or maintenance fees that aren't modeled here. Actual rates, fees, and terms depend on the provider and underwriting. Checking your options won't affect your credit score.
You pay interest on the outstanding balance, not the full credit limit. Pay a draw down quickly and the cost stays small; carry it interest-only and the balance never shrinks while the meter keeps running. The calculator shows both paths so you can see what carrying a balance actually costs.
Many lines charge a draw fee (often 1 to 3 percent per draw), a monthly or annual maintenance fee, or both. A line with a lower rate and a draw fee can cost more than a higher-rate line without one on small, frequent draws. Ask for the full fee schedule and model your actual draw pattern before choosing.
A line fits recurring, short cash-flow gaps, payroll timing, inventory buys, seasonal swings, because you reuse it as you pay it down. A one-time, larger need with a defined payoff usually prices better as a term product. Many businesses hold both and use each for what it does best.
No. Interest accrues only on the amount you've drawn and haven't paid back. An open, unused line typically costs nothing beyond any maintenance fee the provider charges.
Many lines bill interest-only minimums, price with weekly payments, or add draw fees this simple amortized model doesn't include. Match the calculator's assumptions to your agreement's actual payment structure.
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