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Deciding between a loan and a line of credit
They’re both ways of borrowing money. Depending on your needs, one may be a better choice for you.
What are the differences?
A loan lets you borrow a specific amount of money in one lump sum. It’s ideal for single transactions, such as major purchases, home renovations or paying off old debts. Your loan plus interest gets repaid over an agreed-upon length of time.
A line of credit gives you ongoing access to funds that you can use and re-use as needed. You’re charged interest only on the amount you use. A line of credit is ideal when your cash needs can increase suddenly, such as with home renovations or education.
Compare, and see what’s best for your needs
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Lines of Credit |
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