What is a key characteristic of a "Revolver" loan?

A key characteristic of a "Revolver" loan is its flexibility in repayment. This type of loan allows borrowers to draw funds up to a predetermined credit limit, similar to how a credit card functions. Borrowers can withdraw and repay amounts as needed, making it a versatile option for managing short-term liquidity needs. This characteristic is particularly useful for companies that experience fluctuations in cash flow, as they can borrow only when necessary and repay it when they have surplus funds.

In contrast, a fixed repayment schedule would imply structured payment terms and a phased payoff, which is not a feature of revolving credit. Additionally, while revolvers can involve secured lending arrangements, the defining aspect is the ability to repay and redraw the loan as needed, rather than being strictly collateralized or long-term.