How to benefit best from the HELOC draw period?


A HELOC draw period can be somewhere between 5 and 10 years and then the loan has to be repaid in full, or scheduled to amortize over the repayment plan. However, during the draw period, you are having the opportunity to only make interest payments. Additionally, you may tap the HELOC funds as many times as you need, or not at all.

At the end of the HELOC draw term, your HELOC is due in full. Sometimes, a HELOC automatically is calculated to amortize over some repayment schedule. If the HELOC is due in a balloon and you do not have the cash, your lender may be willing to convert it into some kind of a fixed rate loan and have it amortized. If they don’t, you will have to find another home equity loan and refinance.

Also, your HELOC lender may be willing to combine your HELOC with your first or second mortgage, so think of talking to them first.

Mortgage rates hit their lowest since 1955. Ask the home loan experts we recommend Quicken Loans how to take advantage of them.
Was this Mortgage QnA helpful?
Not at all
  • Currently 2.9/5 Stars
  • 1
  • 2
  • 3
  • 4
  • 5
Add to this Answer

Mortgage QnA is not a common forum. We have special rules:

  • Post no questions here. To ask a question, click the Ask a Question link
  • We will not publish answers that include any form of advertising
  • Add your answer only if it will contrubute to the quality of this Mortgage QnA and help future readers
If you have trouble reading the code, click on the code itself to generate a new random code. Verification Code Above:
Bookmark and share this QnA: