A home equity line of credit, or HELOC, essentially acts like a loan against your home. It can be used for any number of reasons, though it is often used to finance major purchases or home renovations. Different than getting a second mortgage, a home equity line of credit is often revolving and interest is charged on the amount you end up using.
You can withdraw all, or part of the amount you are approved for. You need to have at least 35% equity in your home to be considered for a HELOC. Due to recent changes by the Canadian Government, OSFI banks and lenders can only loan up to 65% of your home’s current value, minus your current mortgage amount.
A Brokers For Life mortgage associate can answer your questions, and examine your finances, to see if a home equity loan might be right for you.
A HELOC is one of the best ways to make your home work for you, financially-speaking. That being said, this kind of loan is not for everyone. It’s important to consider your finances, among other important factors, before thinking about applying for a home equity loan.
When pondering a home equity line of credit, consider the following:
Brokers For Life can help determine if a home equity line of credit is right for you. Our mortgage team can answer your questions, look at your financial situation and provide you with a custom mortgage or loan strategy to suit your needs.