If it is a feature that is set forth in the original agreement, then it would not involve a modification. Also, even if this is a feature of the HELOC (fixed rate-fixed period of time for a portion of the balance) that feature remains part of the overall open-end agreement and would be handled as part of the account as far as on-going periodic statements, etc. are concerned. As principal is paid down, that becomes available credit again.
If that is not how it works, then exercising such an option would constitute a new closed-end credit subject to TRID disclosures.
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