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The Advantages of a Line of Credit (LOC)

The Advantages of a Line of Credit (LOC)

While LOCs do have resemblances to credit cards, they also offer quite a lot of benefits over more traditional borrowing alternatives. The major advantage is that Line of Credits will usually have lower Annual Percentage Rates (APRs) when compared to credit cards, making them a less expensive form of financing. It is also much stress-free and more affordable to take out cash advances with a line of credit than with a credit card.
The LOC provider will normally offer the account holder with a check book and credit card for cash withdrawals, purchases, or payments. On the other hand, cash advances from credit cards have high interest rates and will typically charge expensive fees.
Contrasting a term loan, Line of Credits let you to use funds when necessary and pay when you have money. It could be tomorrow, day after or a month, the provider only charges you for the number of days to take credit.


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