A benefit of taking out a business line of credit is that you only pay for what you borrow — interest only applies to the amount you withdraw. Average APRs for business lines of credit can range from 8% to 80% or more.
For instance, let’s say you have a business line of credit totaling $50,000 and you withdraw $10,000. If you and the lender agreed on a 10% interest rate, then the interest would total $1,000 for the amount you withdrew. The amount you would be responsible for paying back would be $11,000, not $50,000. Once you have paid off the $11,000, you would have access to the full $50,000 again.