Personal Line of Credit: What You Need to Know

Personal Line of Credit (PLOC) Explained
When you have a PLOC, you have access to credit money that you can draw from up to a set limit for a given length of time. This is known as the draw period. Just like a credit card, you can withdraw the amount you need from the available balance, and pay interest corresponding only to that amount.

How a Personal Line of Credit Works
As mentioned, you have access to the available credit limit anytime within the draw period. You are allowed to withdraw the amount you need, when you need it, provided it is within your available balance.

There are some things you need to consider, though. These include the following:

1. When you have a PLOC, you are actually getting cash advances, as opposed to term loans, where you get a lump sum amount at the beginning of the contract, and you immediately start incurring and paying for interest charges.

2. With a PLOC, you are only required to pay for interest corresponding to the amount you withdraw.

3. If you follow all the terms of the agreement with the lender, once you have paid for the full amount you have drawn from your personal line of credit, the available credit limit is restored to the original balance, and you can immediately borrow again as long as it is still within your draw period.

Using Your Personal Line of Credit
If you are trying to manage various financial responsibilities at the same time, you must have a certain level of skill and finesse, with the help of a few financial products.

There are some financial situations that will require you to come up with a considerable amount of cash – even if you have significant savings. This is where a PLOC can help, including for start-up business capital, car repairs, and refinancing student loan debs, among others. It is also a good option to pay for ongoing expenses such as home improvement projects like renovations or repairs.

Using a PLOC for home expenses comes with a lot of benefits. For one, you control the amount to borrow (of course, it should be within your credit limit). You will only pay for interest on the amount that you actually borrow.

We specialize in facilitating Personal Line of Credit applications. Get in touch with us today for a free consultation on how you can get a Personal Line of Credit!