Looking for a line of credit? A credit line is a great method of having cash available when you need it. Emergencies like weddings, education, auto repairs or home renovations come up for all of us. The best time to get a line of credit is when you don’t need it! When your cash position and security are at there very best, that is the time to apply.

I was just at the bank looking to mortgage my house and they offered me a $42,000.00 unsecured credit line. When it was my idea to get a credit line and had just started my company, I could not get a penny out of the lenders without putting my house up for collateral. I had already left a great paying job that I had been at for many years. If you are thinking of changing jobs or starting your own business, make sure you talk to your lender and get the line of credit in place before you leave your current secured position or make any changes in how you earn income.

Interest is only charged on the amount of the line of credit you are using, the cash is sitting there for you when you need it. If you have trouble getting your credit line now, never stop trying. See your banker or lenders online until you get the unsecured line of credit. Unsecured credit lines are usually given after a long term near perfect credit or substantial earning power.

Home equity line of credit (HELOC)

A home equity line of credit is typically the easiest credit line to receive. Most online lenders start their credit process with the address of your property. Banks appraise your home and will usually lend you up to 80% of the value. Helocs are a great way to pull cash out of your house to purchase another property or start a business.

Fiscal responsibility is the most important issue with a home equity loan. Paying the interest every month with leave you in the same place for years. Interest rates are not locked in the way a mortgage is. Credit lines move up and down when the feds move them. When this article was written, increases to interest rates have been every 90 days on average for over 24 months.

On the positive side of the home equity credit line, only the interest has to be paid in the lean months and large payments can be put down at anytime without penalties. If you are a very responsible person in America that knows how to manage your finances, I would recommend a Heloc. If you have a history of overspending, the home equity credit line can be a trap that could keep you with a house payment when you are too old to produce strong monthly earnings.