What is Draw Period?

The draw period is the time during which you can borrow funds from a line of credit or home equity line of credit. During this period you can draw, repay and draw again up to your limit, and payments are often based on the outstanding balance. When the draw period ends, the line may renew, convert to a repayment period during which you pay down the balance, or require full repayment, depending on the agreement.

Example

A HELOC with a 10-year draw period lets the owner borrow as needed for a decade before repayment begins.

Related funding

Business Line of Credit: Draw when you need it, pay for what you use.

Related terms

Direct LenderEIN (Employer Identification Number)Equipment LeaseAll terms