Lines of Credit

A line of credit is a revolving credit agreement that allows a borrower to access funds as needed, up to a pre-approved limit. It’s similar to a credit card, but typically offers larger credit limits and lower interest rates.
Key features of lines of credit:
- Revolving credit: Borrowers can withdraw funds as needed and repay them over time.
- Interest only: Typically, only interest is charged on the amount borrowed.
- Annual fee: Many lines of credit have an annual fee.
- Credit limit: A pre-approved maximum amount that can be borrowed.
Lines of credit can be a convenient way to access funds for unexpected expenses or short-term needs. However, it’s important to use them responsibly to avoid accumulating debt.