Line of Credit Loans
Line of Credit Mortgage
What is a Line of Credit?
With a Line of Credit facility, you can pay into and withdraw from your home loan every month, so long as you keep up the regular required repayments. Many people choose to have their salary paid into their line of credit account. This type of loan is good for people who want to maximise their income to pay off their mortgage quickly and/or who want maximum flexibility in their access to funds.
- You can use your income to help reduce interest charges and pay off your mortgage quicker.
- Provides great flexibility for you to access available funds.
- You can consolidate spending and debt management in a single account.
- Without proper monitoring and discipline, you won’t pay off the principal and will continue to carry or increase your level of debt.
- Line of credit loans usually carry slightly higher interest rates.
How does a Line of Credit work?
A Line of Credit or Equity Access facility as it is sometimes known as is primarily an account which allows you to draw upon at your leisure, up to the set limit, kind of like a credit card.
It is usually chosen for those who like to have funds readily available for a variety reasons, whether they be for personal use such as for holidays or home improvements. Some mortgage holders use them for business reasons or to have on hand for future investment.