line of credit

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Related to Revolving Loan: Revolving Loan Fund

Line of credit

An informal loan arrangement between a bank and a customer allowing the customer to borrow up to a prespecified amount.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

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.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

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.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.

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.

Dictionary of Financial Terms. Copyright © 2008 Lightbulb Press, Inc. All Rights Reserved.

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.

The Complete Real Estate Encyclopedia by Denise L. Evans, JD & O. William Evans, JD. Copyright © 2007 by The McGraw-Hill Companies, Inc.
References in periodicals archive ?
The revolving loan is an arrangement which allows for the loan amount to be withdrawn, repaid, and redrawn again in any manner and any number of times, until the arrangement expires.
Separate from the revolving loan fund, the economic development grant program was started about a decade ago, Mizejewski said, and has helped dozens of local businesses buy equipment and hire workers.
Since the beginning of EPA's Brownfields Program, in New England alone EPA has awarded 296 assessment grants totaling $72.7 million, 62 revolving loan fund grants and supplemental funding totaling $68.4 million and 213 cleanup grants totaling $47 million.
Her Majesty stopped by Al Hamra Military Retirees Association -consumer market project- and attended a meeting at Al Hamra Social Development Society with representatives of the various charitable and cooperative societies in Hosha, youth communities and the beneficiaries from the revolving loans program.
(NYSE: LG), a public utility holding company providing a natural gas service through its regulated core utility operations, has signed new revolving loan agreements with Laclede Gas Company, a natural gas distribution utility in Missouri.
A division of New York Community Bank is claiming in court papers filed this week that Kondylis as well as his former partners and related companies lied to the lender when the firm sought an extension of a revolving loan.
Paired with donations from shoppers, the Farm Fund will be able to direct $18,000 to the creation of a new revolving loan fund for local farms committed to using sustainable practices.
HSBC Holdings (LSE: HSBA) is to provide a revolving loan to auto dealership group, AutoCanada Income Fund (ACQ_u.TO).
Air Canada (Toronto:AC.A) (Toronto:AC.B) said on Monday that it has signed a secured revolving loan agreement with Aeroplan Canada Inc to provide up to CAD100m and assist with its liquidity requirements.
The company said the senior secured credit facility consists of a $75 million term loan and an $85 million revolving loan. The financing was jointly led by Bank of America NA as the administrative agent and Wachovia Bank, National Association, as the syndication agent.
In all, 209 applicants were selected to receive 314 assessment, revolving loan fund and cleanup grants:
The EPA offers three categories of brownfield grants: assessment, cleanup, and revolving loan funds.