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For example, if the loans borrower has a credit limit of $10,000 but only borrows $1,000, they will only pay interest on the $1,000 that they borrowed. This can make a revolving credit line a more cost-effective option than a traditional loan, where the online borrower pays interest on the entire loan amount regardless of whether they use all of the money. These loans often have much higher interest rates and fees than online loans or traditional loans, which can make them difficult to repay.

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