Traditional Lines of Credit are more restrictive in their underwriting guidelines, meaning they want to see a more in-depth analysis of the borrower's financial profile in order to qualify that business for a line of credit from their bank.
For a business seeking capital under $100,000, most bigger banks and lenders follow these underwriting guidelines to approve a Traditional Line of Credit application:
- 2 years personal and business tax returns
- At least 1 year showing profit
- 6 months of Bank Statements
- Profit and Loss Statements
- Balance Sheets
- Personal Financial Statement
- Personal FICO Credit Scores
- Debt to Income Ratio
The same Traditional Line of Credit underwriting guidelines can be applied for amounts higher than $100,000 including a minimum percentage amount of cash reserves to have available from borrower's own bank account.
In a Traditional Bank Line of Credit, most big banks will approve a credit limit for roughly 10% of the gross yearly that the business can expect to borrow on their maximum amount of credit limit.
One downfall of a Traditional Line of Credit is that it is subject to an annual review. Banks can revoke or reduce the credit line at any time, and in fact, a survey by the Small Business Association revealed that
29 percent of small business owners reported having their lines of credit reduced, with one in 10 having its line of credit called in by the bank.
 The reduction and bank closure rate is even higher for small business loans according to another study from 2009-2012.  This threat adds a higher risk for a small business to take out such a loan since it would force the business to responsible for paying the balance due right away.