If you look at the Quarterly financial report that recently came out, on the second page it states that there is a $47m LOC however it does not state the currency although it most likely would be in US since they are trading on a US stock exchange or currency of the country they are in I do not know what is interest rate it currently stands at. I can definitely say that there IS a $47m LOC and please kind in mind everyone that a LOAN is entirely different than a LOC quick definition for those who do not know.
Loan - Money that is borrowed but once it's paid you are NOT able to withdraw any money and the interest rates are usually higher pending on what it is used for amongst other variables such as credit, etc..
Example: Car loan, Mortgage.
LOC - Money that is borrowed however the money is not used in full to pay towards a property or vehicle such as a loan and you are able to withdraw money as long as there is an available amount to be withdrawn. Interest rates are usually lower than a loan again pending on same variables as well as additional variables when it comes to a HELOC (Home Equity Line of Credit) which is credit borrowed against a certain percentage and up to 80% of Equity in the home I believe the new percentage is for Canada.
Example: $10,000.00 limit and it is used for renovations and lets say you paid back $500, that means that you are able to withdraw $500 if you are in desperate need of funds or need to cover a cheque < that's the correct way of spelling it by the way not check in your main account so you do not bounce it. You are NOT able to do this with a loan.
$10,000.00
- 500.00
----------
$ 9,500.00 left owing but the total of the LOC is $10,000.00 meaning available balance is $500.00
In case anyone is confused about a HELOC here is an example:
Let's say you have a $200,000.00 Mortgage or MTG for short, you are able to apply for a HELOC which in most cases is LESS interest than a mortgage pending on bank and again you will be able to withdraw the money that's available if needed which you are NOT able to do with a MTG. Side note, certain bank WILL allow you to "FIX" or lock in an interest rate on a HELOC kind of like a MTG which again the interest can be beneficial especially against increasing interest rates so example:
$200,000.00 HELOC (don't quote me on the minimum amount cause different institutions have different amounts and procedures)
FIX - $25,000.00 at 1.6% for 1 year meaning that in 1 year you will pay the principal on $25,000.00 plus 1.6% which is beneficial if you have a HELOC for 4% and knowing that you will NOT be able to withdraw any of that $25k within the year.
Variable - $175,000.00 is variable or available to withdraw but with the chance of the interest rate going up if the bank of Canada/America decides to increase interest rates. Usually by 0.5%-1% in most cases. Still lower than a MTG.
The reasoning as to why I posted this is because I know for a fact that a big chunk of the population don't know much about financing or even their own financial situation although I know most of you here are intelligent and know about this stuff so I was just spreading the wealth of knowledge to those who do not know and I also know that some people consider a LOAN to be the same thing as a LOC which is entirely false.
GO BFHJ!
