Line Of Credit Loans And Their Benefits
If you are looking to buy or renovate property, a line of credit loan may suit your circumstances.
A line of credit will generally be set up over a normal home loan term with the line of credit option in place for one-to-five years, or revolving.
You generally only pay interest on the portion of the loan that is drawn down and the rate is usually variable. Some home loans will renew the line of credit after a set period, whereas others will require you to begin making payments on the principal after a certain amount of time.
Often investors or borrowers with fluctuating incomes benefit most from line of credit facilities because they offer a great deal of flexibility.
This type of loan could be compared to having a very large secured credit card, but it is very important to note that in order to reduce the size of the loan over time, good discipline and budgeting is required.
A mortgage broker can talk you through the specific pros and cons that pertain to line of credit loans and your particular circumstances.
To get more detailed information on your situation, talk to a Loan Market mortgage broker today.