With a line of credit, instead of receiving a lump sum, you are approved for a credit limit. You can get funds at any time, in any amount, up to your credit limit. Unlike loans, when you make payments on your line, you free up credit. If you borrow $5,000 of a $10,000 line, and then make a payment of $2,500, you would have approximately $7,500 in available credit. Lines of credit can be beneficial for open-ended borrowing needs, like remodeling your business or purchasing inventory. Some people have personal lines to pay for unexpected expenses so they do not have to deplete their revenue. The primary benefit is the flexibility to borrow what you need when you need it, and also to have access to more credit as you pay your balance down.