Draw Period

Importance: 0.57

Is a company: no

Is a proper noun: no

Synonyms

  • accessible funds
  • extraction period
  • pull out
  • take out period

Definition of Draw Period

  1. On a line of credit, the draw period is the fixed time when a borrower can make withdrawals from the account. Once the draw period expires, borrowers may be able to renew the credit line or may be required to pay the outstanding balance in full, or over time.

Related Terms and Acronyms

  • Line of Credit (LOC) Bank,
    • A commitment by a financial institution to lend up to a specified maximum amount to a customer during a specified period of time.
  • Repayment Period Bank,
    • In a home equity line of credit, that portion of the life of the loan that follows the draw period. During the repayment period, the borrower cannot take out any more money, but must pay down the loan.
  • Standby Commitment Bank,
    • A commitment from a lender to make a loan in a specified period of time on specified terms with the understanding that the borrower will not likely draw down the funds.
  • Credit Line Bank,
    • The maximum money amount available in an open-end credit arrangement such as a credit card or overdraft protection.
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