A line of credit (LOC) is a commitment by a financial institution to lend up to a specified maximum amount to a borrower during a specified period of time.

Under reverse mortgage programs, borrowers have a choice of payment plans including term, tenure, line of credit (LOC), and combinations of term/LOC and tenure/LOC.

The line of credit plan makes payments whenever the borrower requests them up to the available principal limit. The line-of-credit (LOC) plan is the most popular payment plan with borrowers. Most likely this reflects the fact that LOC plans allow the borrower to access a large portion of their principal limit in the first year.

Home equity line of credit (HELOC) loans are another popular form of consumer LOC.

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