Credit portal




What is a revolving credit card

Other People Are Reading

Give and Take

A revolving credit balance begins with your credit limit. If you have a $5,000 limit and you don’t charge anything or use any of the money, you have a zero balance. If you do use the account, interest typically isn’t charged if you pay your entire balance -- everything you’ve borrowed -- within the monthly billing period. You can take $5,000 again the next month if you want to. But if you charge $1,000 and make only a minimum payment, you now have about $4,000 in credit. Some portion of your payment will go toward interest, but if you don't have an interest-only account, some will go toward your balance as well. You'll free up that much of your credit limit so you can use it again. This cycle is “revolving,” because your balance may go up or down in any given month depending

on the amount of your payments and how much you’ve charged.


Please enable JavaScript to view the comments powered by Disqus.
  • Photo Credit Thomas Northcut/Photodisc/Getty Images

More Like This

How Is Interest Calculated on a Line of Credit?

How to Calculate Revolving Credit Card Interest

Earn Cash by Shopping: The Best Credit Cards for the Holidays

You May Also Like

Revolving Credit-to-Debt Ratio. The credit-to-debt ratio, also called the credit utilization ratio. Ratio of Revolving Account Balances to Revolving Credit Lines;

What Does the Term "Revolving" Mean on a Credit Report. Revolving Balance Credit Cards; How to Reduce a Home Equity Line.

That liability goes to the balance sheet as a debit. Paying Lines of Credit. (HELOC) is a revolving line of credit.

Category: Credit

Similar articles: