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Thursday, October 19, 2006

Revolving credit

A credit line that is restored as the borrower pays off what is owed

Credit cards and home equity credit lines have revolving credit. For example, you could go on a shopping spree using your Visa card and charge up to $600. As you pay off your Visa bill, your $600 credit amount will be restored and you can go for the next round of shopping. Loans, such as mortgages and student loans don’t have revolving credit.
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