Line of Credit

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Line of Credit

The maximum borrowing power granted to a person from a financial institution.

Line of credit denotes a limit of credit extended by a bank to a customer, who can avail himself or herself of its full extent in dealing with the bank but cannot exceed this limit. It most frequently covers a series of transactions, in which case, when the customer's line of credit is nearly exhausted or not replenished, the customer is expected to reduce the indebtedness by submitting payments to the bank before making additional use of the line of credit.

See: capital
References in periodicals archive ?
Inability of REITs to renew revolving lines of credit would likely hinder the capability of such REITs to meet their financial obligations and would likely result in rating downgrades," said Marks.
GMAC-RFC Health Capital is providing a $17 million revolving line of credit and a $15 million term loan to Medegen Holdings, LLC, a leading manufacturer and marketer of medical products worldwide.
According to CFC CFO, Steven Lilly, the increase in the overall size of the revolving lines from the prior $3.
The new agreement terminates the revolving lines of credit on April 9, 2004.
Both bank revolving lines mature in June 2006 with no prior amortization, and amounts outstanding will bear interest at variable interest rates.