A line of credit is a flexible loan that lets you borrow up to a set limit, paying interest only on the amount used. It can be secured or unsecured and is ideal for short-term borrowing needs.
A term loan is repaid in fixed installments over a set period, often with a fixed interest rate. It’s used for specific needs like equipment or expansion and can be short-term or long-term.
An asset-based loan is a loan secured by assets like inventory or equipment. The loan amount is based on the value of these assets.