How to Build a Credit Line

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Building a credit line enables an individual or business to have access to the checking account of a bank, allowing the customer to maintain short-term cash flow expenses and pay the debt back gradually. Build up a credit line with advice from a registered financial consultant in this free video on money management.

Part of the Video Series: Money Management & Credit
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Video Transcript

This is financial advisor, Patrick Munro, talking about how to build a credit line. A credit line is a unique financial instrument that allows an individual, just based on their signature and their good credit, to really have access to the checking account of a bank. It's really your checking account, and when you write a check for your purposes you accrue debt and that is extending your credit line out. So, if you have a twenty thousand dollar credit line and you write a check for five thousand dollars that means you have fifteen thousand dollars left in your credit line. Normally, this credit line is good for businesses because it allows them to pay short-term cash flow expenses, and then pay that off for from revenues that come in. Credit lines are best kept in order, and of course, on an annual basis it pays to go to the provider and ask to be increased on the credit line. They will do just that if you have kept your credit line in order. This is financial advisor, Patrick Munro, talking about how to establish and maintain credit lines.

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