Quick answer
A personal line of credit and a credit card both give you a credit limit, a monthly bill and interest on what you owe. The CFPB says a personal line of credit is drawn by special checks or transfers to checking and may charge a fee each time you use it. Cards usually have a grace period on purchases.
A personal line of credit works a lot like a credit card. The differences are in how you get the money and what it costs to use.
Side by side
| Personal line of credit | Credit card | |
|---|---|---|
| How you draw | Special checks or transfers to checking | Purchases; cash advances at a cost |
| Credit limit and monthly bill | Yes | Yes |
| Minimum payment | Yes | Yes |
| Fee per use | Possible | Cash advances usually carry a fee |
| Grace period | Check the terms | Usually on purchases if paid in full |
| Where offered | Banks and credit unions, usually with a checking account | Banks, credit unions, retailers |
| Secured? | Usually unsecured | Usually unsecured |
Based on CFPB descriptions.
When each fits
- Line of credit: recurring cash needs, such as uneven income, where you want money in your checking account.
- Credit card: purchases you pay off in full to use the grace period.
Avoid using a card for cash: the CFPB says cash advances usually have a higher APR and interest starts right away.
What to compare
The CFPB suggests comparing the APR, whether and how much it can change, fees to access the line, annual fees, late fees and other fees.
Need a one-time amount instead? See personal loan vs line of credit.
Want to compare real offers? Use the form on this page to see whether partner lenders may have an installment loan for you, with APRs on our network from 5.99% to 35.99%, or call (800) 236-7761.
Examples are illustrations, not offers. Approval, APR and terms depend on the lender, your state and your credit profile.
Frequently asked questions about line of credit vs credit card: key differences
Is a line of credit better than a credit card?
It depends on the costs. Compare the APR, how the APR can change, and the fees to draw, the annual fee and late fees, as the CFPB suggests.
Do personal lines of credit have a grace period?
Check the terms. The CFPB says card grace periods typically apply only to purchases. Ask the lender how interest on line of credit draws works.
Where can I get a personal line of credit?
The CFPB says banks and credit unions offer them and usually require a checking account with the same institution.
Is a personal line of credit secured?
The CFPB describes personal lines of credit as unsecured, unlike HELOCs, which are backed by your home.
Sources
- CFPB: What is a Personal Line of Credit? (accessed 2026-10-09)
- CFPB: What should I look for when shopping for a Personal Line of Credit? (accessed 2026-10-09)
- CFPB: What is a grace period for a credit card? (accessed 2026-10-09)
- CFPB: Can I withdraw money from my credit card at an ATM? (accessed 2026-10-09)
Last updated 2026-10-09. How we research and update pages.