1. Loan and line Credit there are two different ways of Borrow from the lender for personal or commercial use.

2. A loan is a lump sum amount Pennies It is for one-time use whereas there is access to a predetermined amount of credit that can be borrowed multiple times.

3. Interest on a loan is charged immediately, even if the money is used, whereas in a line of credit, interest is charged after the money is borrowed.

4. Loans are for specific purpose whereas a line of credit can be used for any purpose.

5. The Rate of interest Loans are generally less than on a line of credit.

(Content on this page is courtesy of Center for Investment Education and Learning (CIEL). Contributions by Girija Gadre, Aarti Bhargava and Labh Mehta.)