Lesson 4 of 8
Borrowing from banks: term loans, credit lines, covenants and borrowing bases
This lesson explains how a lender borrows from banks: the difference between a term loan and a credit line, why a committed line costs the bank something to keep open, how covenants give the bank a say when things go wrong, and how a borrowing base ties the amount a lender can draw to the quality of its own loan book.
Published 4 November 2026 · Listen to this lesson
In this lesson
- Term loans and credit lines
- Why a committed line costs the bank something
- Covenants: the bank's say
- Headroom: how far is the breach?
- Borrowing bases
- Questions to ask about bank borrowing