What Are Line of Credit Loans?
The purpose of a line of credit loan is to provide a borrower with access to a source of funding to meet a short-term need. Like bridge loans, a line of credit loan fills a gap that exists between a present need and a secondary source of funding, such as an individual’s next paycheck or a grant to a business funding a project.
Line of Credit Loan Defined
A line of credit is defined as an extension of credit based on existing equity or collateral with value. A line of credit is an amount that a borrower can access up to the maximum amount of equity and must be paid back like any other type of loan.
Line of Credit Loan Requirements
A line of credit loan carries financing and interest charges when utilized. The line of credit has to be paid back, either on an installment basis or when due based on a negotiated time period.
Student Loans
- 3 Factors that Contribute to Fluctuating Interest Rates on Student Loans
- What are the Consequences of Defaulting on a Federal Student Loan?
- What Happens when You Default on a Private Student Loan?
- Federal vs. Private: Comparing Student Loan Interest Rate
- Can You Get a Private Student Loan with No Cosigner?
