What is a Line of Credit?
A Line of Credit is flexible
A Line of Credit (LOC) is an agreement between lender and borrower. The borrower prequalifies for an amount of money (say $1,000) that they can borrow against when they need it. When they do borrow against the amount, they agree to repay the amount borrowed, with interest, in regular payments like a credit card. They can also borrow more at any time against the total, just not more than the total available from their LOC.
If this sounds like it could help you, a Line of Credit from Minute Loan Center could be the solution for you. With a Minute Loan Center LOC, you can prequalify for a line of credit and access advances when you need them.
How do I prequalify?
The Minute Loan Center application process is easy and protected by bank-level security protocols! (Yes, it’s that secure.)
Frequently Asked Questions
What are the benefits of a Line of Credit?
A LOC can provide more flexibility than other types of loans. Like a credit card, you have access to a certain amount of credit, against which you can borrow. Unlike a credit card, the interest is simple interest compared to compound interest. This means you only pay interest on the amount you borrowed, and never on any interest accrued.
This combination of features provides flexibility – you only borrow the amount you need, and control, because each payment pays down your principle, reducing the amount used. Many Americans find a LOC to be a very useful credit tool.
Are Lines of Credit secured or unsecured?
While some LOCs, such as ones based on the value of your home are secured, many LOCs, such as the Minute Loan Center LOC are unsecured, which means you do not have put anything up for collateral in case you do not pay your loan back. You are still responsible for your loan, but no personal property is tied to it.
What kind of interest is charged on a Line of Credit?
Most LOCs use Simple Interest. Beware of any LOC that uses Compound Interest.
Can I have more than one loan against my credit line at the same time?
Yes, you can borrow against the full amount of your available credit. So, if you have a total line of credit of $2,000, and borrowed $500, you can borrow up to $1,500 against your LOC before you pay back the $500.
