This is an open-ended agreement, in which the application is also the credit contract. At any point after approval, purchases may be made against the credit limit as long as the account remains in good standing. Generally, all that is required to add additional purchases to the master account is a signed invoice, similar to a charge card slip. The chief appeal of revolving financing is its flexibility. The application process is a one-time ordeal, and additional purchases are simply added onto the account.
Interest is charged on a monthly basis against the balance on the account.
There are no prepayments of interest or penalties for early pay-off. Any payment over minimum is applied directly to principal balance. Revolving accounts are exclusive to the dealer. You cannot use a revolving account with dealer X to make a purchase from dealer Y, even if they both use the same financing resource. The downside to revolving financing is simply that it is an unsecured loan, and, as such, uses more stringent criteria in regard to the approval process.