What Does a Revolving Credit Card Account Mean?
If you’re confused by some of the credit card jargon; you’re not alone. The terminology can be confusing but, before you sign on the dotted line, you’ll want to take time to educate yourself on a few of the basics. Revolving credit is one of the key terms. When you apply for a credit card, most of the time you’ll be getting an open or revolving credit account. In simple terms, revolving credit means that once you’re approved and have been given a credit limit (the amount you’re allowed to borrow based on your credit score and history), then you’re free to make charges and payments at will as long as you stay within the preset credit limit. Each month you’ll be required to make a minimum payment that will include interest charges. As you reduce your balance, you’ll have more of the funds available to use, up to your credit limit. As an example, if your credit limit is set at $2,500 and you charge purchases totaling $500, you’ll have $2,000 remaining for future purchases. If you then mak
