A draw on a line of credit refers to the act of accessing a portion of the available credit limit, which can be used for immediate financial needs. In our system, draws are highly flexible and customizable, allowing each draw to carry its own unique configuration and terms. This includes the ability to set a specific interest rate (independent of the line of credit's base rate), repayment schedule, and even the option to convert the draw into an amortized installment loan. This level of flexibility enables borrowers to tailor their financing to specific use cases, optimizing cash flow management and repayment strategies while maintaining the overarching benefits of a line of credit.

Draw Types

Draws function in various way depending on the type of draw taken against a line of credit.

Value	Description
DRAW	A withdrawal of funds from a line of credit, typically used for general purposes and subject to the credit limit and terms of the line.
SIMPLE_CHARGE	A transaction that deducts funds from a line of credit to cover a specific expense or fee, often initiated by the lender or a third party.
REIMBURSEMENT	A draw that repays a borrower for out-of-pocket expenses, often tied to specific documentation or approval requirements.
CASH ADVANCE	A draw that provides immediate cash access, often with higher interest rates or fees due to its unsecured nature.
AMORTIZED DRAW	A draw that is converted into an installment loan with a fixed repayment schedule, combining the flexibility of a line of credit with the structure of a term loan.