The interest only term for a LOC is usually 25 years with no requirement to pay the principal until the end of the term eg. If the balance is $20,000 outstanding then the principal is $20,000.
A line of credit has a variable interest rate that fluctuates over the life of the loan. Payments vary depending on the interest rate and the amount owed. Minimum monthly repayments cover only the interest, although you can elect to pay the principal at any time.
A line of credit can also be used for investment purposes such as purchasing an investment property, managed funds or shares.
You can apply for a line of credit in addition to your existing home loan when you have enough equity in your property it can be used as security for a line of credit. For more details on borrowing against equity click here
Should you have any questions or would like to make an enquiry about arranging a new line of credit please contact us on 1300 734 410
1300 734 410.
Example |
|
|
Line of Credit |
$30,000 |
|
Amount Used |
$25,000 |
|
Available Credit |
$5,000 |
|
Amount Paid Back |
$5,000 |
|
Available Credit |
$10,000 |
