Financing
HELOC repayment period
The phase after a HELOC draw period when new borrowing stops and the outstanding balance must be repaid under the agreement.
Glossary
Financing
Primary references on this page:
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CFPB: What you should know about HELOCsThe HELOC repayment period begins when the contractual draw period ends. The borrower can no longer take ordinary new draws and must repay the remaining balance on the schedule in the agreement. The required payment can rise materially when principal repayment begins.
Many HELOCs use a variable rate, so the future payment depends on both the outstanding balance and the applicable rate. Some plans amortize over a stated period, while others can require a larger balance payment. The note and disclosure, not a generic HELOC example, determine the actual transition.
A landlord using a HELOC for property work should forecast this date alongside leases, balloon payments, capital projects, and expected refinancing. A project that only works while the line requires a small draw-period payment is not fully funded.
Create a transition review well before the end date. Confirm the balance, index and margin, expected payment method, maturity, conversion options, and whether the property can carry the repayment-period obligation during vacancy or repairs. Record the assumptions, statement date, and decision owner so a future reviewer can reproduce the forecast rather than inherit a mystery payment.
Repayment-period readiness test
Run the property cash flow using the expected principal-and-interest payment and a higher-rate case. Keep the lender calculation with the model and update it when the line balance or rate changes.
Refinancing is not guaranteed
An expected future refinance is an exit assumption, not committed funding. Property value, income, credit, program rules, and rates can change before the HELOC reaches repayment.