LOC Utilization

How much of your line of credit is currently drawn — higher means more risk.

Definition

LOC utilization measures how much of your available credit you're using. At 50%, you have plenty of cushion. At 80%, one deal going sideways could max you out with no emergency capacity. Kaison flags utilization above 75% as MEDIUM risk and above 90% as a hard constraint (blocks NO_GO).

Formula

Utilization = Current LOC Balance / LOC Limit × 100

Related Terms

Line of Credit (LOC)

A revolving credit facility used to fund property acquisitions and rehabs.

Retrospective

A post-deal review comparing what you estimated vs what actually happened.

Educational content only. Consult a CPA or attorney for advice specific to your situation.