A personal loan traditionally offers a lump sum of funds at origination with fixed monthly payments over the life of the loan. Term options for personal loans typically vary from 1 to 5 years and offer lower loan amounts for those looking to take out minimal debt.
A personal line of credit allows the borrower to draw on the loan multiple times, offering the ability to draw on the funds available once principal on the funds drawn is repaid. A line of credit generally offers longer-term options and higher loan amounts for those looking to fund larger purchases or life events. Learn more about personal lines of credit vs. personal loans.