A credit line is a flexible loan that allows you to borrow money as needed up to a certain limit. It is a credit facility extended by a bank or other financial institution to a government, business, or individual customer that enables the customer to draw on the facility when they need funds. A line of credit is a revolving loan that allows you to access money as you need it up to a certain limit. You can borrow up to that limit again as the money is repaid. A credit line is a pre-approved loan that allows you to get money when you need it and not all at once.

Key features of a credit line include:

• Credit Limit: The maximum amount of funds a customer is allowed to draw from a line of credit is typically called the credit limit or overdraft limit.

• Interest: Interest is charged on a line of credit as soon as money is borrowed.

• Repayment: You can repay what you borrow from a line of credit immediately or over time in regular minimum payments.

• Flexibility: A credit line allows you to borrow in increments, repay it, and borrow again as long as the line remains open.

Credit lines can be secured by collateral, or may be unsecured. Personal lines of credit are usually unsecured, meaning you don’t need to use collateral to take out the line of credit. Secured lines of credit are backed by collateral, such as your house or a savings account.

Credit lines can be used to cover unexpected expenses that do not fit your budget. They can also be used to manage cash flow, as you can have the line available to you for emergencies or to help you tide over during months when you have less income.

Overall, credit lines can be a useful tool for managing finances, but it is important to be aware of the potential downsides, such as high interest rates, late payment fees, and the potential to spend more than you can afford to repay.