line of credit

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Related to Revolving Credit Line: Revolving credit facility, Available Credit

Line of credit

An informal loan arrangement between a bank and a customer allowing the customer to borrow up to a prespecified amount.

Line of Credit

An agreement between a bank and a company or an individual to provide a certain amount in loans on demand from the borrower. The borrower is under no obligation to actually take out a loan at any particular time, but may take part of the funds at any time over a period of several years. This agreement is fairly common in situations in which a business must make payroll but does not always have the operating income to do so, especially when its operating income is seasonal or otherwise varies from month to month. It is also called open-end credit or a revolving line of credit. See also: Credit Card.

line of credit

A credit arrangement in which a financial institution agrees to lend money to a customer up to a specified limit. A line of credit, generally arranged before the funds are actually required, provides flexibility for the customer in that it ensures the ability to meet short-term cash needs as they arise. Also called bank line, credit line, revolver, revolving credit agreement.

Line of credit.

A line of credit, sometimes called a bank line, is the most you can borrow under a revolving credit arrangement with a credit card issuer, bank, or mortgage lender.

When you borrow against a line of credit, you pay interest on the amount of money you actually borrow, not on the available balance, or full amount you are able to borrow.

For example, if you have a $10,000 line of credit on a credit card, you may borrow as much or as little as you want up to that amount, and you pay interest only on the amount you have borrowed.

If you carry a balance of $3,000, you only pay interest on that amount, but there is still $7,000 available for you to borrow. Once you repay the amount you borrow, you can use it again.

A line of credit may be secured with collateral, or unsecured. A line of credit on a credit card is usually unsecured, for example. But if you have a home equity line of credit, your home serves as collateral against the amount you borrow.

line of credit

A revolving loan issued by a financial institution;it may be secured by a mortgage or other collateral, or unsecured.The borrower may draw down the line, up to the maximum limits, at any time and pay interest each month. If the principal is repaid during the time period of the line, then the maximum amount or any lesser amount may be drawn down again.Lines of credit are typically for one year, and then extended from year to year afterward. If a borrower draws down the maximum amount and then does not repay any of the principal,the lender will eventually refuse to renew the note and may require payment in full or conversion to an amortizing loan with regular monthly payments that will eventually pay it in full.Lines of credit are best used by persons with reliable income arriving at sporadic times or by persons awaiting the sale of an asset but needing cash in the meantime.

References in periodicals archive ?
Credit granting services - revolving credit line worth 25 million RON, in order to ensure pre-financing and / or co-financing projects benefiting from external funds, according to the descriptive documentation.
Plans to launch a short-term loan acting on the basis of a revolving credit line at once or in installments at the request of the Contracting Authority from January to 31.
The revolving credit line was arranged by a bank syndicate comprised by 16 global commercial banks.
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The financing package includes more than $2 million for the capital expenses associated with the project, as well as in addition, a revolving credit line to provide working capital for initial production activity.
for short-term revolving credit line, provided in the following section of tenders as far as possible:
Home entertainment distributor Image Entertainment Inc (OTCQB:DISK) reported on Thursday that the company has entered into an agreement with PNC Bank NA for a revolving credit line of up to USD17.
6m) revolving credit line to Gladstone Commercial Corp (NASDAQ:GOOD), the real estate investment trust (REIT) said yesterday.
We anticipate that the revolving credit line will be used to fund a portion of our future stock repurchases," concluded Mr.
The new facility is comprised of two parts: a 7-year $75 million term loan that will be used to refinance both RCN's existing $34 million first-lien and $41 million third-lien term loans; and a 5-year $55 million revolving credit line that will replace RCN's existing letter of credit facilities.
The new Plus Card is an expansion of the relationship originally created in June 2004 for GE to offer PayPal Buyer Credit, a private label, revolving credit line available to registered PayPal customers.