Tips for Establishing a Line of Credit

A personal line of credit is a revolving account. You can use and reuse it without filling out a new application. The lender establishes a credit limit, but only charges interest on your borrowed amount. A personal line of credit gives you quick access to emergency money and can provide you with overdraft protection for your checking account. Interest rates on credit lines are usually higher than the rates on home equity lines of credit, or HELOCs. Interest on personal credit lines is not tax-deductible, but the interest on your first $100,000 of home equity debt often is.