Operating Loan
Definition
- A loan that is intended for short-term financing. This type of loan is often used for cash flow support or to cover operating expenses from day to day.
Synonyms
short-term loan, payroll loan, cash flow loan
Related Terms and Acronyms
- Borrow — Definition,
- Sand, gravel or other material used for grading; a slope.
- To get a loan of money.
- Bridge Loan — Definition,
- A loan that "bridges" the gap between the purchase of a new home and the sale of the borrower's current home. The borrower's current home is used as collateral and the money is used to close on the new home before the current home is sold. Some are structured so they completely pay off the old home's first mortgage at the bridge loan's closing, while others pile the new debt on top of the old. They usually run for a term of six months.
- Cash Flow — Definition,
- The money an investment produces after subtracting cash expenses from income.
- Commercial Loan — Definition,
- A loan taken out by a business.
- Expense — Definition,
- Costs incurred through a business's operations.
- Line of Credit (LOC) — Acronym,
- A commitment by a financial institution to lend up to a specified maximum amount to a customer during a specified period of time.
- Loan — Definition,
- Letting another party use something of value temporarily.
- Net Operating Loss (NOL) — Acronym, Very Important,
- A net loss for the tax year because of business or casualty losses. Taxpayers may use an excess loss of one year as a deduction for certain past or future years.
- Operating Cash Flow (OCF) — Acronym,
- The money a company generates from its business operations. This revenue excludes costs from certain investments.
- Short-term Liabilities — Definition,
- Money that you have to pay in less than 12 months, including wages, short-term loans, taxes, credit card balances and long-term loans.
- Solvency — Definition,
- To be able to meet one's financial liabilities in the short or long term.
