Revolving Credit
Revolving-credit terms that explain reusable limits, changing balances, and the account dynamics behind utilization and minimum payments.
Revolving credit pages explain accounts that let a borrower reuse available credit as balances are repaid. This section helps readers understand why revolving accounts behave differently from fixed-term loans.
It is the right place to compare credit lines, reusable balance buckets, open-to-buy room, utilization pressure, and the way ongoing card borrowing can affect both cash flow and scores.
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Balance Terms
Rate and Timing Terms
In this section
- Revolving Credit
Revolving credit means reusable borrowing that allows balances to rise and fall within an approved limit.
- Line of Credit
Line of credit means a reusable borrowing arrangement that lets the borrower draw, repay, and draw again up to an approved limit.
- Over-the-Limit
Over-the-limit means the balance or account activity has gone beyond the approved credit limit.
- Credit Limit Increase
Credit limit increase means a lender's decision to raise the maximum amount available on a revolving account.
- Minimum Payment Warning
Statement notice showing how long repayment may take and how much debt may cost at minimum-only payment pace.
- Billing Cycle
Billing cycle means the recurring period used to group account activity before a statement is issued.
- Revolving Account
Revolving account means an open credit account that can be reused as balances are repaid.
- Credit Line
Credit line is the approved dollar amount a borrower can use on one revolving account.
- Statement Closing Date
Statement closing date means the date when a billing cycle ends and the statement balance is set.
- Due Date
Due date means the deadline for making the required payment on a revolving credit account.
- Revolving Balance
Revolving balance is the amount currently owed on a reusable credit line such as a credit card or line of credit.
- Open to Buy
Open to buy is the spending room still available on a revolving account after balances and other holds are counted.
- Variable APR
Variable APR means an annual percentage rate that can change over time based on the account terms and market benchmarks.
- Purchase APR
Purchase APR means the annual percentage rate that applies to ordinary purchase balances on a revolving account.
- Purchase Balance
Purchase balance is the portion of a revolving balance that comes from ordinary card purchases.
- Balance Transfer APR
Balance transfer APR means the annual percentage rate applied to transferred debt on a credit-card account.
- Cash Advance Balance
Cash advance balance is the portion of a revolving balance created by cash-advance transactions.
- Balance Transfer Balance
Balance transfer balance is the portion of a revolving balance that came from debt moved from another account.
- Cash Advance APR
Cash advance APR means the annual percentage rate that applies to cash-advance balances on a credit-card account.
- Promotional Balance
Promotional balance is the part of a revolving account carrying temporary special pricing or terms.
- Line Utilization
Line utilization measures how much of one revolving account's credit line is currently in use.
- Credit Line Decrease
Credit line decrease means a lender lowers the amount available on an existing revolving account.
- Draw Period
Draw period is the part of a revolving line when the borrower can still take new advances under the agreement.
- Interest Accrual
Interest accrual means borrowing cost keeps building on an unpaid balance over time under the account's pricing rules.
- Prime Rate
Prime rate is a public benchmark often used as the index for variable-rate consumer credit such as cards and lines of credit.
- Rate Margin
Rate margin is the fixed number of percentage points added to an index such as prime to set a variable consumer credit rate.
Revised on Friday, April 24, 2026