Would you consider a Principal + Interest HELOC?

[Ryan Anderson]

Hi everyone, 

I'm trying to make a final decision on a HELOC lender in the next day or so here. A local credit union has an option to go up to 100% LTV (up to a $400,000 limit), but hey require you to pay 1% of the balance of the account (principal and interest) at the end of each month. They have a 10 year draw period and a 10 year repayment period, so they require people to pay principal to keep the balance from ballooning at the end of the 10 year draw period.

For those with experience leveraging their HELOCs to buy investment properties, would you ever consider a HELOC that wasn't interest only during the draw period? Seems like there would be seasons when interest only payments might be helpful as you are building cash flow. I'm trying to find a lender with the best terms that can provide me with the maximum credit limit, but am not sure if it's smart to go with a lender that doesn't offer an interest only option. 

Thanks, everyone!

Ryan