Funds Disbursement Revolving line of credit. Draw what you need when you need it. Draw period is the initial 120 months.
Interest Rate Adjustable rate, subject to adjustment every three months. Monthly payments during the first 120 months can be for interest only or 1% of the outstanding statement balance. When draw period expires, monthly payments increase to include principal plus interest for the next 120 months.
Terms 240 months: first 120 months is the draw period when members may take advances; second 120 months is repayment period.
Benefits Interest may be tax deductible. Useful when unsure of how much will be needed upfront.