What is a draw period?
Draw period: A draw period is the stretch of time, often several years, during which you can borrow from a line of credit such as a HELOC.
During the draw period, some HELOCs allow interest-only payments. When it ends, the repayment period begins: you can no longer draw, and payments usually rise to cover principal as well as interest.
The loan agreement sets out how long each period lasts and how payments are calculated.
When you compare offers
Plan for the payment once the draw period ends, not just the payment while you are drawing.
Related guides
- How a HELOC's Draw and Repayment Periods Work
What happens during a HELOC's draw period and repayment period, why the payment can change, and the questions worth asking before you open a home equity line of credit.
This glossary is for general educational purposes and isn't financial, legal or insurance advice. Lendara is not a lender and does not make credit decisions. Lendara is a free online marketplace that connects you with participating lenders and providers, who set their own eligibility rules, rates, fees and terms. Lendara may receive compensation from partners, which may affect which offers appear and their order.