Frequently Asked Questions
Lenders usually list this as an annual percentage rate Annual Percentage Rate. It includes all fees and interest charged on an annual basis, providing the most accurate reflection of the cost to borrow.
- A loan is a lump sum of money that you withdraw once and then repay over a set schedule, including interest. A line of credit is a form of revolving credit that lets you borrow money when you need it, up to a predetermined amount. Opening a line of credit lets you keep an account open for the long term. After you use money from your line of credit, you’ll need to make repayments toward your balance to replenish your available credit.There are different kinds of lines of credit you can choose from, including unsecured and real estate secured lines of credit. Each type works slightly differently. Learn more about the types of lines of credit available and if one might be right for you with this article.
Closing a line of credit account does not necessarily affect your credit score. However, closing the account could increase your credit utilization ratio. That might have a negative effect on your credit score.
This can vary between lenders and products. For example, the minimum payment required for home equity lines of credit during the variable draw period would be interest-only payments.