What is a line of credit?
A line of credit (also called a credit line or credit limit) is the maximum amount of money a bank will lend to an individual or business without requiring additional approval. The lender determines a line of credit based largely on the individual’s credit worthiness and income potential. Certain large corporations and high-profile public figures have such a substantial line of credit they can literally borrow money against it for a lifetime. Having a line of credit is very useful for small business owners who may have to take out several loans over time to purchase equipment or upgrade their facilities. Instead of applying for one $25,000 bank loan, for example, a business owner with a $25,000 line of credit can take out a $5,000 loan in April, then a $10,000 loan in August and finally a $2,000 loan in December, all with prior approval from the lender. By using a line of credit, borrowers can take out just enough money for a specific expense then pay it back entirely before taking out
A line of credit is simply a loan with an established credit limit. The benefit to this type of loan is that the member can advance funds on this account up to the maximum credit limit as often as they like with no need to reapply. We offer five different types of products under this plan. They are Ready Credit, Prime Credit, Overdraft Protection, Share Secured, and Certificate Secured.
