The full explanation
When that period ends you can no longer borrow and you enter the repayment period, when payments are often much higher; sometimes the whole balance is due at once. It usually has a variable interest rate. If you do not repay it, you could lose your home.
An example
Óscar opens a HELOC to have money available for repairs. He draws only what he needs, but checks how much his payment will rise when the draw period ends.
You will see it in…
- The HELOC's Truth in Lending disclosures
- The credit line's statements
- Your credit report
