Definition Of

Line of Credit

Line of credit is a common type of loan in which a borrowing “cap” is established and borrowers can use the credit at their discretion. Lines of credit require periodic interest payments.

Line of Credit is a pre-approved credit facility (usually for one year) enabling a bank customer to borrow up to the specified maximum amount at any time during the relevant period of time.

Line of credit is a maximum amount that a commercial bank agrees to lend to a business borrower if it has the funds available.

Line of credit means a preapproved amount of money the holder may borrow, in whole or in part, provided the bank has funds available.