A Line Of Credit loan or facility is a great way to access funds for a range of purposes using the equity in your property up to a set value.
A Line of Credit (LOC) gives you access to the equity you have built up in your property, with interest accruing on the balance of the loan. Your lender will provide an approved limit and then it is up to you how you use the funds – either in a lump sum or bit by bit. This gives you the flexibility for renovations, purchasing shares or a range of personal options.
The repayment amount is dependent upon the amount of money that you have withdrawn from the available balance, and in most cases only the interest needs to be paid back. Some LOC loans will also allow you to add the interest to your balance, as long as that balance doesn’t exceed your approved limit.
There are, however, some things to be aware of: