An open-end credit account is sometimes referred
to as a revolving account. This type of credit is most common
with a credit card. The biggest advantage to this type of
credit is that you can charge as much as you want (up to a
predetermined limit), and may pay it off as quickly as you
like as long as you make minimum monthly payments. If you
want to decrease the loan, you have the option to make a buydown
payment. Within the spending limits, your account balance
may vary from month to month.
An important point to keep in mind with open-end credit accounts
is that it’s easy to overspend and interest rates are
typically high. Keeping that in mind will help you maintain
a reasonable balance and to use the account wisely.
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