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What "full draw" means
With a traditional HELOC, you are approved for a credit limit and borrow from it whenever you want during a draw period, often ten years. You pay interest only on what you have actually used. The Figure HELOC works differently: the full approved amount is disbursed to your bank account when the loan funds. In practice, the first draw behaves like a home equity loan, with a fixed rate and a set repayment schedule from day one.
Why it matters: an interest example
Suppose you are approved for $100,000 at a 9% fixed rate, but your renovation only needs $40,000 in the first year. These figures are simplified for illustration.
| Full draw (Figure HELOC) | Draw as needed (traditional HELOC) | |
|---|---|---|
| Balance in year one | $100,000 | $40,000 |
| Approximate first-year interest | $9,000 | $3,600 |
| Monthly payment (10-year amortization) | About $1,267 | About $507 on $40,000 |
Borrowing $60,000 you did not yet need costs roughly $5,400 in extra interest in the first year in this example, before counting the larger origination fee on the bigger loan. The fix is simple: request only the amount you need now.
How the redraw feature works
After funding, every dollar of principal you repay becomes available to borrow again, up to your original line amount, for the first five years. If you borrow $80,000 and pay principal down to $65,000, you can redraw up to $15,000. Each redraw may come with its own fixed rate based on market rates at the time. After the redraw window closes, the loan simply amortizes to payoff.
Full draw vs. a traditional HELOC draw period
| Feature | Figure HELOC | Typical bank HELOC |
|---|---|---|
| Money at closing | Full approved amount | Usually none required |
| Interest charged on | Entire balance from day one | Only what you draw |
| Rate | Fixed at closing; redraws may get a new fixed rate | Usually variable |
| Payments | Principal and interest from the start | Often interest-only during the draw period |
| Access to more money | Redraw repaid principal for 5 years | Draw up to the limit for the draw period |
The Figure HELOC trades flexibility for predictability. You know your payment from the first month, and it does not rise if the prime rate goes up. A bank HELOC can be cheaper when you need money gradually, but its payment can jump when interest-only payments end or rates rise.
A simple rule for choosing your amount
Add up what you will spend in the next 60 to 90 days, then add a buffer of about 10%. If a later expense comes up, you can redraw principal you have repaid during the first five years, or apply for additional financing then. Check whether your amount fits the lender's limits in the Figure Loans requirements.
Who the full draw suits
- Good fit: paying off credit cards in one step, a project with a known total cost, or any expense you will spend within weeks.
- Poor fit: a phased renovation, an emergency fund you may never touch, or tuition paid in installments over several years.
The legal dispute
A consumer class action filed in North Carolina alleges that the full-draw requirement makes the product function like a home equity loan rather than a line of credit, and that the larger draw increases origination fees. Figure Lending disputes the claims and the case was unresolved as of our last review. You can read more in our legitimacy fact check.
How to avoid overpaying
- Price your project or debts first and add a modest buffer, not a large one.
- Use the calculator to compare the payment at your real amount versus your maximum.
- Remember the origination fee is a percentage of the full draw, so a smaller loan also means a smaller fee.
- If you truly need flexible access over years, compare a traditional HELOC in our alternatives guide.
FAQs
Can I take less than my approved amount?
Is the Figure HELOC really a HELOC?
Our team researches home equity products using lender disclosures, NMLS records, CFPB data, and independent reviews. Every figure is fact-checked before publishing and pages are re-reviewed regularly. Our editorial standards · Report an error