Open Ended Account

An open ended credit account also known as a revolving account is an agreement by a bank to lend a specific amount of money to a borrower and once the borrower has repaid the amount they are allowed to borrow the money once again.

For example, a credit card or a line of credit is used as an open ended account. Before you are able to use an open ended account the creditor is supposed to disclose the conditions in which a financial charge may be used, the method of calculating the financial charge, if different rates are used to impose a financial charge, any changes that may occur to an account, a statement when the credit is secured, and a statement of protection for the creditors and borrowers.

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