Lines of credit - Posted by RHuff

Posted by RHuff on January 27, 2000 at 20:02:39:

Thanks for the response Fred. I appreciate it.

Lines of credit - Posted by RHuff

Posted by RHuff on January 27, 2000 at 18:30:43:

In the “Part time newbie having a blast” success story by Tim Randle, he mentions lines of credit. How does a line of credit differ from a home equity loan or other such instrument? Are they common? How easy (or difficult) are they to get? Thanks for your responses.

Re: Lines of credit - Posted by Chris

Posted by Chris on January 31, 2000 at 15:09:39:

One way to get a line of credit is to get overdraft checking.

My credit union charges 12.5% APR if accessed. It can be accessed by “bouncing” a check. If a check is written for more than the amount in your checking account the overdraft provision is automatically accessed so that you do not bounce the check. The limit on your overdraft account varies by credit and income when you apply.

The credit union or bank will also give you checks to access this overdraft account without using your primary checking. Some banks link your overdraft to the cash advance feature of a credit card.

This is all transparent to whoever you give the check.

-Hope this helps, Chris

Re: Lines of credit - Posted by Mark (SDCA)

Posted by Mark (SDCA) on January 31, 2000 at 12:39:46:

A line of credit is a generic term. It can be secured (by a car, boat, or property) or unsecured (a “signature” loan, secured only by your signature ie agreement to pay).
A home equity loan comes in 2 flavors. One is a pure second mortgage where you borrow X dollars for Y
years at Z%. THe other (which I have AND LOVE) is an equity line of credit. I am approved for a certain amount at prime + .5. I can access any amount up to my “line of credit” by writing a check. I am not charged any fees and only pay interest on the amount of credit I actually access. It is a great feeling to know that I can do any deal up to a certain amount just by writing a check.

Hope this helps,


Re: Lines of credit - Posted by Fred

Posted by Fred on January 27, 2000 at 19:23:01:

A line of credit is set a side account that is assigned to you from a finacial institution to be barrowed from as you please as long as you make your payments. A home equity loan is used the same way but, one of the major differences is that you will be allowing a lien to be put on your house. The interest rate is usually higher on a line of credit. My advice is and I feal many investors will agree that if you can get a line of credit,get it first.