HELOC Not Interest Only... Why?

[Mehran K.]

Hi everyone,

Got my HELOC on my primary last month and just made the first payment. It turns out my loan terms during the draw period are that my minimum payment is 1% of the balance. For some reason I thought it would be interest only.

My minimum payment was $711
of which $513.08 went to principal
and $197.92 went to Interest. (3.99% APR Adjustable)

To circumvent this inconvenience I just drew out the $513.08 right after I made the minimum payment to make things essentially interest only...

Why on earth would they NOT have it interest only during my draw period? Is there some regulation they must adhere to? Just trying to wrap my head around it.

The negative to the above situation is that now on my credit report and my DTI calculations it shows $711/mo as debt instead of the $197 I thought it would be.

Kind of just venting a bit and I figure this may help someone out looking for info on HELOCs in the future.

[Brandon Hughes]

so if the balance is 0, does that show a 0$ payment and not effect dti?

(currently looking for myself)