Credit limit

The maximum amount of credit that is available on a credit card or other line of credit account.

The maximum amount of credit that is available on a credit card or other line of credit loan.

A credit limit, also known as a credit line, is the maximum amount of money you can borrow under a revolving credit agreement.

For instance, if you have a credit card with a credit limit of $3,000, and you charge $1,000, you can spend $2,000 more before you reach your credit limit. And if you repay the $1,000 before the end of the month without making additional purchases, your credit limit is back up to $3,000 again.

Most credit issuers charge additional fees or penalties if you exceed your credit limit.