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Know Your Credit Options

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Credit can help you pay for major expenses such as a home, car, or college education, but it's also convenient for smaller purchases — like vacations or even your groceries. Used wisely, credit can help you manage your finances, and can be especially useful for emergencies.
The type of credit you choose may depend on a combination of what you need the credit for, how much you want to borrow, which type of credit offers the best interest rate, and your collateral (property or funds you can pledge to secure the debt).
A loan makes sense when you know exactly how much money you need.
  • You borrow a lump sum at a fixed interest rate for a specified length of time.
  • The fixed monthly payments include interest charges and any fees, and reduce the amount of the loan until it is paid in full.
A line of credit is a good option when you're not sure exactly how much you need, or when you'll need it.
  • Lines of credit are reusable sources of credit, usually offered at a variable interest rate. You can access your money over a period of time without having to reapply each time you need funds.
  • You can spend up to your pre-assigned credit limit.
  • You make payments and pay principal and interest only on the amount you access.
Credit cards
More convenient than cash, a credit card can be used for any purpose at millions of places worldwide where credit cards are accepted. It allows you to spend up to your pre-assigned credit limit.
Credit cards can be secured or unsecured. With a secured credit card you pledge collateral in order to receive credit.
It's important not to confuse credit cards with Debit Cards, which are not a form of credit. On the contrary, a debit card like the Wells Fargo Debit Card is simply a convenient way to access funds in your checking account. When you use a debit card, the money is withdrawn from your account.
Personal loans and lines of credit
Personal loans and lines of credit generally have higher credit limits than credit cards and can be a useful way to get cash quickly.
Loans for homeowners
If you own your home, it may be your biggest financial asset. By accessing your available home equity, you may be able to get lower rates than other kinds of credit, and you may also be able to take advantage of tax-deductible interest. Consult your tax advisor regarding deductibility of interest. Explore your options for refinancing and home equity financing in our Home Loans and Programs section below.
  • Automobile. Choose from an auto finance loan, where you use your car as collateral, a home equity loan, in which your home is the collateral, or a personal loan, which may or may not require collateral. Read "Ways to Pay for Your Car" for details.
  • College education. Choose from student loans or a personal loan for financing.
  • Home. Most homes are purchased with the help of a mortgage. There are many different loan programs to choose from. Take a look at our Home Loans and Programs section below or talk to a Wells Fargo Home Mortgage consultant.
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