Lines of Credit

About Lines of Credit

A line of credit is a type of loan that allows a borrower to access a certain amount of credit. Unlike a traditional loan, a line of credit provides the borrower with the flexibility to use the funds as needed and only pay interest on the amount of credit actually used. Lines of credit can be either secured, meaning they are backed by collateral, or unsecured, meaning they are not backed by collateral. They can also be either revocable, meaning the lender can cancel the line of credit at any time, or irrevocable, meaning the terms of the line of credit cannot be changed once it has been agreed upon. Lines of credit are often used to provide individuals and businesses with a source of financing for short-term expenses or to cover unexpected costs.