--- title: Law Firm Financing with a Line of Credit description: Attorneys needing funding to expand their practice may benefit from a flexible line of credit. image: https://smartbizbank.com/hubfs/Imported_Blog_Media/lawyers-line-of-credit-2.jpg --- - [Share](https://smartbizbank.com/blog/law-firm-financing-with-a-line-of-credit#) - - - - [mailto:?subject=Check%20out%20https://smartbizbank.com/blog/law-firm-financing-with-a-line-of-credit](mailto:?subject=Check%20out%20https://smartbizbank.com/blog/law-firm-financing-with-a-line-of-credit) # Law Firm Financing with a Line of Credit April 5, 2023 By [Suzanne Robertson ](https://smartbizbank.com/blog/author/suzanne-robertson) Law firms often operate with a unique business model based on client fees and case settlements that isn’t shared by many other businesses. Because of this, working capital needs sometimes creep in and access to the right financing may be imperative.  The gold standard in small business loans is typically an [SBA loan](https://www.smartbizloans.com/sba-loans). SBA loans have low rates, long repayment terms, and low monthly payments. [![See if you're eligible for a line of credit](https://no-cache.hubspot.com/cta/default/21458256/9265ab5e-d5e6-4820-9f19-227f74967113.png)](https://cta-redirect.hubspot.com/cta/redirect/21458256/9265ab5e-d5e6-4820-9f19-227f74967113) But sometimes, a line of credit (LOC) can support smaller, more immediate gaps in a law firm’s cash flow. Using funds from an LOC may help a firm cover costs and avoid drawing down on resources.  Here are a few fast facts about business lines of credit and how they may help a law firm expand. ## What is a line of credit (LOC)? A business LOC is a revolving loan that lets you borrow the funds you need up to a certain limit. You only pay interest on the money you use — similar to how a credit card works. It’s “money on demand” and may be a flexible solution for attorneys in need of funds to cover operations.  ## When is it useful to open an LOC? Lines of credit may have some advantages over regular term business loans. There's generally a wide use of funds, there are no set monthly payments, and no interest is charged on the unused money. When you repay a borrowed amount, those funds are typically immediately available again. ## How can funds from an LOC be used? Each lender has unique guidelines so always be sure to confirm that your use of funds is approved. In general, most LOCs may be used in the following way to strengthen a law practice: - Hiring additional lawyers, paralegals, support staff, and contractors  - Financing marketing campaigns to help your firm stand out and attract new clients  - Making payroll  - Covering unforeseen expenses - Purchasing software or business equipment  - General working capital  Tip: If you don’t need immediate funds, it may be worth opting for a small business loan with low rates and long terms like an [SBA loan](https://www.smartbizloans.com/why-sba-loans). It may be a good idea to speak with a financial professional to help you decide the best financing option for your circumstance.  [![See if you pre-qualify](https://no-cache.hubspot.com/cta/default/21458256/7cc0e43b-a4ce-4dc3-a21a-b721421c096c.png)](https://cta-redirect.hubspot.com/cta/redirect/21458256/7cc0e43b-a4ce-4dc3-a21a-b721421c096c) ## What should you consider when opening a line of credit? Business lines of credit may be ideal when you don’t know the exact costs of a certain project or if you need to cover ongoing operational expenses. They may also be used to fund almost any type of business expenses, like hiring staff, advertising, legal expenses, and more. Tip: Another important benefit of a line of credit? It may help you [build solid credit](https://www.smartbizloans.com/blog/loan-applications-understanding-your-fico-liquidcredit-score/) making you more attractive to lenders if you need low-cost funding in the future. Your [credit report](https://blog.smartbizloans.com/blog/5-smart-credit-strategies-small-business-owners/) is usually the first thing considered by lenders. ## How to qualify for a business line of credit A business line of credit isn't like a [term loan](https://www.smartbizloans.com/bank-term-loans), but lenders consider similar information to qualify like your [credit score](https://smartbizbank.com/blog/business-credit/what-you-need-to-understand-about-credit-scores/), time in business, and [revenue](https://smartbizbank.com/blog/business-finances/small-business-revenue-determine-where-you-stand/). To qualify for a line of credit from $25,000 to $150,000 from a bank in the SmartBiz® network, you'll need at least two years in business and $100,000 in annual revenue.  Although some lenders don't set a minimum credit score, borrowers typically need a score of 660 or higher to qualify. A line of credit from a bank in the SmartBiz network has a 12-month term with interest-only monthly payments. Users may pay back and draw funds as needed. There is a 6% origination fee based on the approved line amount and there are no fees for subsequent draws on the line.  ## Strategies to consider to help manage a line of credit  1. Open a line of credit before it’s needed Getting approved for a business line of credit with the best interest rates may take longer than expected. It’s typically a smart strategy to apply for one before you need the funds so your cash flow remains steady. 2. Limit how often you use the line of credit An LOC is typically convenient. However, it’s best not to overuse it. LOCs are generally not intended to be used for years like other loan products. If you need a large amount of cash, an SBA loan with low rates, long terms, and low monthly payments is typically more cost effective. 3. Pay down quickly and leave open  An LOC is less expensive than a credit card but is not intended to carry a balance for any length of time. They’re best used for short-term funding that may be paid off quickly, allowing the LOC to remain open most of the time for upcoming financial needs.  ## In conclusion If the time isn’t right to apply for an SBA loan, a line of credit typically offers access to fast cash and flexibility, as well as the opportunity to build your credit.  If you’ve determined that an LOC is the right fit, [learn more or apply today](https://www.smartbizloans.com/line-of-credit).  [![See if you pre-qualify](https://no-cache.hubspot.com/cta/default/21458256/fecfd265-0de2-48ae-800b-c205310ef667.png)](https://cta-redirect.hubspot.com/cta/redirect/21458256/fecfd265-0de2-48ae-800b-c205310ef667) ![Q3 Promo E1](https://smartbizbank.com/hubfs/Q3%20Promo%20Email%20Images/Q3%20Promo%20E1.png) ### Access Funds Quickly Apply for a Bank Term Loan from a bank in our trusted network [![See if you pre-qualify](https://no-cache.hubspot.com/cta/default/21458256/08df270b-4561-4437-a5aa-11d47ef08efb.png)](https://cta-redirect.hubspot.com/cta/redirect/21458256/08df270b-4561-4437-a5aa-11d47ef08efb) - [Follow SmartBiz](https://smartbizbank.com/blog/law-firm-financing-with-a-line-of-credit#) - - - - - ### Access to the right loan for right now We’re connecting small businesses with SBA, bank term loans, lines of credit, and flexible financing options. [![See if you pre-qualify](https://no-cache.hubspot.com/cta/default/21458256/08df270b-4561-4437-a5aa-11d47ef08efb.png)](https://cta-redirect.hubspot.com/cta/redirect/21458256/08df270b-4561-4437-a5aa-11d47ef08efb) ##### Topic - [Business Loans](https://smartbizloans.com/blog/tag/business-loans) - [Business Stories](https://smartbizloans.com/blog/tag/business-stories) - [Marketing](https://smartbizloans.com/blog/tag/marketing) - [Money Management](https://smartbizloans.com/blog/tag/money-management) - [Operations](https://smartbizloans.com/blog/tag/operations) ## Related Posts [ See all blog posts ](https://smartbizbank.com/blog) [Money Management July 01, 2026 ## How to Reforecast Your Budget Based on Summer Trends When you built your company’s budget for this year, you no doubt looked at past data. However, there were probably also some future projections that... Read More ](https://smartbizbank.com/blog/reforecast-your-budget-with-summer-trends-smartbiz-bank) [Money Management June 24, 2026 ## The Counterintuitive Truth About Summer Slowdowns For many small business owners, summer is an uncomfortable time of year. Many consumers travel or spend more time at home, which typically leads to them making fewer... Read More ](https://smartbizbank.com/blog/do-less-this-summer-to-grow-your-business-smartbiz-bank) [Money Management June 22, 2026 ## Small Business Revenue: Determine Where You Stand As a business owner, regularly reviewing your annual revenue gives you a clear picture of your company’s current health and helps you evolve your business strategically so... Read More ](https://smartbizbank.com/blog/small-business-revenue-determine-where-you-stand) ### Smart growth is smart business ## Access to the right loan for right now See if you pre-qualify, without impacting your credit score. 1 [ Apply Now ](https://smartbizbank.com/apply) 1. We conduct a soft credit pull that will not affect your credit score. However, in processing your loan application, SmartBiz Bank and the lenders with whom we work will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit pull and may impact your credit score. The SmartBiz® Small Business Blog and other related communications from SmartBiz BankSM are intended to provide general information on relevant topics for managing small businesses. Be aware that this is not a comprehensive analysis of the subject matter covered and is not intended to provide specific recommendations to you or your business with respect to the matters addressed. 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