Line of credit

A line of credit gives you flexible access to funds whenever you need them. You can use it to cover unexpected expenses, consolidate debt, or make large purchases, and you only pay interest on the amount you use. As you repay what you borrow, the funds become available again for future use.

Not quite – your borrowing limit is set when you’re approved for a line of credit based on factors like your credit history, income, and financial situation. You can borrow up to that limit as needed, and as you repay, the funds become available again. If you ever need a higher limit, you can request a review, but approval isn’t guaranteed.

You can make payments on your line of credit through online and mobile banking, automatic transfers, in-branch payments, or at a BCU ATM. At minimum, you’ll need to cover the interest each month, but you can pay more to reduce your balance faster. Since it’s a revolving credit, any repaid amount becomes available for future use.

If you don’t make the minimum payment on your line of credit, you may incur late fees and interest charges. Missing payments can also negatively impact your credit score and make it harder to access credit in the future. It’s important to make at least the minimum payment to avoid these consequences.

The length of time you can use a line of credit depends on the terms of your agreement. Typically, a line of credit is a revolving credit, meaning it remains available as long as you manage it well and make regular payments. However, the lender may review your account periodically and could adjust or close it if necessary.

A loan provides a lump sum of money that you repay over a set period, often with fixed monthly payments. A line of credit, on the other hand, offers flexible access to funds up to a set limit, and you only pay interest on what you use. With a line of credit, as you repay, the funds become available again for future use.