Close-ended credit is a one-time loan that is typically used to finance a specific purchase, such as a car or a home. The loan amount is fixed, and the borrower makes regular payments over a set period of time until the loan is paid off. Once the loan is paid in full, the account is closed, and the borrower can apply for a new loan if needed. Examples of Close-Ended Credit: Auto Loans Mortgages Personal Loans Student Loans 

Open-ended credit, on the other hand, is a revolving line of credit that can be used for multiple purchases. The borrower is given a credit limit and can borrow up to that limit as needed. As long as the borrower makes the minimum payments on time, they can continue to borrow from the line of credit. Examples of open-ended credit include credit cards and home equity lines of credit. 

One key difference between close-ended and open-ended credit is the amount of flexibility they offer. Close-ended credit offers less flexibility, as the loan amount and repayment period are fixed. Open-ended credit offers more flexibility, as the borrower can borrow as much or as little as needed up to the credit limit. Another difference is the interest rates and fees associated with each type of credit. Close-ended credit may have lower interest rates, as they are typically secured by collateral such as a car or a home. Open-ended credit may have higher interest rates and fees, as they are unsecured and carry more risk for the lender.

Both types of credit have their advantages and disadvantages, and borrowers should carefully consider their financial needs and repayment ability before choosing one over the other. Close-ended credit may be a better option for a large one-time purchase, while open-ended credit may be more suitable for ongoing expenses.