Home Equity Line of Credit (HELOC)
A Home Equity Line of Credit provides instantly available funds that can be spent any way you like such as RRSP contributions, renovations, vacation, cottage, investment properties etc.
The HELOC is secured against your property, so the interest rate is much lower than an unsecured line of credit.
The HELOC is very attractive to investors or self employed individuals as the monthly payment required is very low (interest only). Clients that have a HELOC also have the added benefit of a fully open mortgage that can be paid down as much as they want at any time with no penalties. Also, you are able to re-draw the funds from the line of credit at any time up to the credit limit. It is the same concept as a credit card, but with a much better rate! As well, you only pay interest on the amount of money that you have used, not your total credit limit.
You are able to borrow up to 80% of the value of your home. You can keep the line of credit for as long as you own the home. So if you pay it off and need money quickly, all you need to do is write a cheque. You do not have to apply for a new loan.
With most lenders, if at any time you wish to convert your HELOC to a regular mortgage, you can do so with a simple phone call.
HELOC's can be used to purchase a new principal residence or a rental property. If you already own your property, we can look at placing a HELOC on your existing property, so that you can use the equity that you have built however you like.
If you have any further questions about HELOC's, please feel free to contact us anytime.
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Home Equity Line of Credit Mortgage Application
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