# What is the difference between "line of credit" and "revolving line of credit"?

#### roniy

##### Senior Member
What is the difference between "line of credit" and "revolving line of credit"?

"Line of credit" is "credit line", right ?

So as I know when you have a credit card, your credit line (also 'credit limit' ?) is the highest amount you can take credit from the creditor(bank), right ?

And as I know when you pay off the credit , you can take again more credit.
That is approximately how the credit system works, right ?

So I've just seen there two terms:
"Line of credit"
"Revolving Line of credit"

And it's turned out that "revolving line of credit " is what I explained before.

And "Line of credit" is 'a loan that is approved before the money is actually needed". so as I understand 'line of credit' is just a regular loan according to this definition.
But it is also a 'credit line' which is what I've explained before.

So I am really confused about these three terms:
"Credit Line "
"Line of credit"
"Revolving Line of credit"

I hope you understand me

Thanks, roniy.

• #### Dimcl

##### Senior Member
So I am really confused about these three terms:
"Credit Line "
"Line of credit"
"Revolving Line of credit"

"Revolving Line of Credit" is as you've already defined it.
"Line of Credit" is a loan which a lender extends for a specified amount of unsecured credit for a specified time period. This is also called a "credit line".

#### roniy

##### Senior Member
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"Revolving Line of Credit" is as you've already defined it.
"Line of Credit" is a loan which a lender extends for a specified amount of unsecured credit for a specified time period. This is also called a "credit line".
But when you get the "Revolving Line of Credit" you get a credit limit which is also a "credit line"....
so credit line has 2 different meanings ?

#### Dimcl

##### Senior Member
But when you get the "Revolving Line of Credit" you get a credit limit which is also a "credit line"....
so credit line has 2 different meanings ?

I have never heard of a "credit limit" being called a "credit line" in Canada. For example, your credit card is actually a "revolving line of credit" (you can borrow up to a certain amount and once you've paid it back, you can borrow again). However, your "credit limit" on that revolving line of credit may be \$1,000.00, \$5,000.00, \$10,000.00 or whatever the bank has authorized. If the "limit" is \$10,000.00 and you've borrowed that entire amount, once you pay it down/back, you can use the card again.