SBA Express Line of Credit: Up to $500,000 Revolving — Interest Only on What You Use
Same program as the SBA Express loan — same $500,000 ceiling, same rate caps, same 36-hour SBA answer — reshaped as a revolver: draw for payroll or inventory, repay, draw again, paying interest only on the outstanding balance. For businesses whose need is a cycle rather than a purchase, the shape alone is worth five figures a year.
ExpressLoans.com is not a lender. Representative example: a $100,000 Express line carrying an average drawn balance of $40,000 at an illustrative 12% accrues about $400/month in interest during the revolving period; principal repays on the lender’s schedule or at term-out. Rates float with Prime within SBA caps. The 36-hour clock is the SBA’s answer to your lender, not funding time — the realistic 2–8 week path is on the Express loan guide, and it applies here unchanged.
Everything from the Express loan applies. Here’s what changes.
Eligibility, documents, timeline, lender selection — all identical to the flagship guide. The differences are the shape:
The shape math: capacity isn’t cost
The revolver’s entire advantage in one comparison. A business needs $200,000 of capacity for swings, but its average drawn balance is $60,000:
| $200K Express line of credit | $200K Express term loan | |
|---|---|---|
| You pay interest on | $60,000 average drawn | $200,000 from day one |
| Interest per year (12%*) | $7,200 | ≈$24,000 in year one |
| Idle capacity costs | Little or nothing | Full freight |
| The shape saves | ≈$16,800 a year — for the same safety net | |
The seasonal version is even starker: a retailer drawing $150,000 from September to December and repaying by February pays about $6,000 for the season — versus $18,000 carrying the same money as a year-round term loan. When the need breathes, the financing should breathe with it. Model your own cycle in the calculator.
*Illustrative — Express rates float with Prime within SBA caps; your lender quotes the margin.
A revolver’s life, in three phases
Up to 10 years total, structured by the lender as a draw period followed by repayment.
The revolving period
Draw any amount up to the limit, when you need it — payroll Friday, the inventory buy, the slow-paying receivable. Interest-only (or interest-plus-small-principal) payments on what’s outstanding.
Repay and reload
Receivables land, season turns, you pay the balance down — and every repaid dollar is available to draw again. This loop is the product; a line drawn once and never repaid is just a term loan with extra fees.
Term-out
When the draw period ends, the outstanding balance converts to a fixed repayment schedule. An $80,000 balance terming out over 5 years at 12% runs $1,779.56/month — plan the conversion before it plans you.
The Express LOC vs. every other working-capital shape
| SBA Express LOC | Bank/online LOC | Business credit card | Invoice factoring | MCA | |
|---|---|---|---|---|---|
| Typical cost | Prime + 4.5% – 6.5% envelope | 10% – 40% | 20%+ (0% intro aside) | 1% – 5%/month | ≈40% – 150%+ equiv |
| Limit | Up to $500,000 | $10K – $250K typical | $5K – $100K | % of receivables | Revenue-based |
| Setup speed | 2 – 8 weeks | Days – weeks | Days | Days | Same day |
| Best at | Cheapest standing capacity | Faster, smaller capacity | Small recurring spend | Slow B2B payers | Read the decode first |
The pattern holds: the Express LOC is the slowest to set up and the cheapest to hold — which is exactly why you open it before the crunch, not during it. A line established in a calm quarter is same-day money forever after.
Line discipline: three rules that keep a revolver healthy
Lines don’t fail at signing — they fail in month nineteen. The patterns are predictable.
Timing, not losses
A line bridges the gap between spending and collecting. Drawing to cover structural losses converts a timing tool into permanent debt at a floating rate — if the balance only ever grows, the problem isn’t cash flow, and the line is hiding it.
Clean it down
Healthy revolvers touch zero — or near it — at least once a year; many lenders expect a periodic clean-down and all of them watch for it at renewal. The rest-to-zero is your proof, and theirs, that the line is a cycle and not a crutch.
Respect the float
The rate rides Prime: a two-point Prime move on a $300,000 balance is $6,000 a year, arriving without a signature. Budget the line at a point or two above today’s rate, and term-out into fixed payments when a balance turns long-term.
Qualifying — one addition to the flagship checklist
Eligibility, credit floors, the document package and the lender-selection playbook are identical to the Express loan guide — use its checklist as written. Lines add one emphasis: because the lender is underwriting a cycle rather than a purchase, expect extra attention on accounts-receivable aging, inventory turns and the seasonality visible in your bank statements. A one-page note explaining your cash cycle — when money goes out, when it comes back, and why the gap exists — does for a line application what the use-of-proceeds breakdown does for a term loan.
Worth knowing the family tree: above the Express ceiling or for specialized needs (contract financing, builders), the standard 7(a) CAPLines program runs lines to $5 million — slower machinery, bigger limits, same guaranty logic. Your SBA lender orders from the whole menu; the business hub maps it.
Express line of credit questions, answered
The revolver mechanics, decoded.
Express line of credit or Express term loan?
One-time purchase with a known price: term loan. Recurring swings — payroll gaps, inventory cycles, seasonal dips: the line, where idle capacity costs little. The shape math above puts the difference at ≈$16,800/year on a typical $200K need.
Do I pay anything on the unused portion of the line?
Interest, no — it accrues only on the drawn balance. Some lenders add modest annual or unused-line fees, and the one-time SBA guaranty fee applies at setup (zero for veteran-owned businesses, as on any Express loan). Ask for the full fee schedule before signing.
What is term-out?
The scheduled end of the draw period, when the outstanding balance converts to a fixed repayment plan — e.g., $80,000 over 5 years at 12% is $1,779.56/month. Know your term-out date from day one and plan the balance you’ll carry into it.
How long can the line run?
Up to 10 years total maturity, structured by the lender as a revolving period followed by term-out — a common shape is several years of draws, then conversion. The split is negotiated; longer draw periods favor cyclical businesses.
Is the rate fixed?
No — Express lines float with Prime inside the SBA caps. Two Prime points on a $300,000 balance is $6,000/year, so budget above today’s rate and fix via term-out when a balance turns structural.
Is qualifying different from the Express term loan?
Same SBA rules, same practical floors (~640 personal credit, 2+ years operating, guarantees from 20%+ owners). Lenders add scrutiny on your cash cycle — AR aging, inventory turns, seasonality — because that cycle is what they’re funding.
What’s the difference between an Express LOC and CAPLines?
Family members: the Express LOC is the fast, up-to-$500K revolver on Express machinery; CAPLines is the standard 7(a) line program reaching $5 million with full-package underwriting and specialized variants (contract, builders, seasonal). Outgrow Express, graduate to CAPLines.
When should I open the line?
Before you need it. Setup takes 2–8 weeks; draws take a day. A line established in a calm quarter is the cheapest same-day money your business will ever have on call — applying mid-crunch surrenders both the timeline and the negotiating position.
Open it in the calm. Draw it in the crunch.
The cheapest standing capacity in small-business finance takes 2–8 weeks to set up and one day to use. One free request matches your file with SBA lenders that write Express lines — before the season turns.
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