A Line of Credit is a novel offering for customers and is customized, thereby providing customers the freedom to utilize their desired portion of the loan amount as and when they require the same. This facility ensures a specified line of credit amount for a selected loan tenor. The customer can withdraw as much as he/she needs and will have to pay interest only on this amount that is used rather than the whole amount which is usually the case for regular loan products. Customers can withdraw more money whenever they need the same without even having to let the financial institution know of the same. There is also the right to make pre-payments for a part of the loan whenever the customer has surplus funds and also get the amount that is pre-paid again as a loan in certain situations.
Alongside, the sheer flexibility and convenience offered by this system, customers can repay easily when only the interest component is charged as part of the monthly EMIs. The principal can be repaid when the tenor ends. In case a customer has a good credit score and meets all Personal Loan Eligibility requirements, a line of credit facility can be applied for at competitive rates of interest. In case you already have a line of credit and wish to convert it into a regular personal loan, you can do this as well!
You can withdraw money as per your own needs and this helps you meet unplanned and sudden expenditure. You can raise money to meet these requirements without having to pay any interest on the amount that is not utilized. You can save on interest costs while having ample security in terms of getting funding whenever required. There will be no limits on using these finances for any fixed purpose. You can use it to take care of major expenses like weddings, car purchases, higher education of children, home renovation and even for meeting daily expenditure. The EMIs will always be lower since you will be repaying only the interest component. There is no complicated application procedure to go through. You can apply for the line of credit facility if you meet regular personal loan eligibility requirements. There is minimal paperwork and you can simply contact the lender and ask for this facility.
You can make part-prepayments for lowering your EMIs whenever you have any bonus/surplus funds. There are no limits on prepayment as well. There are no penalties or charges for prepayment that you will have to bear as well. The interest rates are quite reasonable in most cases and you will not have to offer any collateral or security to avail of this facility as well. Nowadays, technology helps you easily withdraw money from your credit line online and even pre-pay some portion of the loan whenever you want.
You can use the customer portal of your lender to accomplish these tasks without any hassles whatsoever! In most cases, there are no charges to be paid for withdrawals as well. This makes Line of Credit a really handy option for those who need money to meet sudden expenses and at regular intervals and desire convenient repayment and usage options.