Mortgage Intelligence Oshawa/Whitby

12/07/2022

12/06/2022

SUB-ACCOUNTS
Creating Sub-accounts in a Home Equity Line of Credit Combined With a Mortgage
Home equity credit in conjunction with a mortgage could include other forms of credit and banking services within a single limit. You can set these loans and credit products in sub-accounts within your home equity line of credit. This is commonly called a Collaterally Charged mortgage.
A variety of loan or credit options may have different terms depending on your personal equity credit including if you have an existing mortgage, done a consumer proposal or a debt consolidation.
You may also borrow money from an equity loan to repay the loans you're owed by others.
It's important to be careful when using home equity loans along with mortgage loans so that no credit card charges become a burden.

For more details: John Desbois at (289)928-8883

12/05/2022

BUYING A HOME – PART 2
Buying a Home With a Home Equity Line of Credit Combined with a Mortgage
Your home purchases may include a home equity loan and a fixed term mortgage. Depending on the amount of money you are borrowing against the home you can negotiate with your lender which portion would be fixed and which portion would be a Home Equity Line of Credit .
If you are refinancing your property you also can have a fixed portion and HELOC portion of your mortgage to give you the upfront cash and the flexibility to access future equity.

For more details: John Debois at (289)928-8883

12/04/2022

BUYING A HOME – PART 1
Can I Buy a Home using a Home Equity Line of Credit and a Mortgage?
Occasionally borrowers may purchase their own houses with home equity or a mortgage combination. These are sometimes called a re-advanceable mortgage. With this option a buyer can purchase a house via a revolving loan or a fixed loan.
With a line of credit, the borrower pays back the principal whenever it desired, provided the minimum rate is met monthly. The loan will repay as a fixed-term loan in its amortization period.
For purchasing a home using HELOC with mortgages together, you will have a 20 percent down payment.

For more details: John Desbois at (289)928-8883

12/03/2022

HELOC FACTS: SERIES 3
How do I Qualify For a Home Equity Loan?
Most major Canadian banks also offer home equity financing. The rules require 80% of the house to get a housing loan before it's granted a HELOC. Once your 20% equity requirement is met, lenders will assess your credit history, the market value of your home and your income stability before approving your loan.
How Much Can I Borrow From a Home Equity Loan?
If you have 20% equity on your home, you may be eligible for credit up to 65 % of its appraisal or market value.
Plan to Use Your Home Equity Line of Credit
Create the proper method to use your equity loan and get it. Think of a repayment timeline that allows not only for interest only payments but also for additional monthly payments. Make an appropriate budget for your project and ensure you include your down payment.
You can borrow 65% of the purchase price of your home through the Home Equity Loan Program.
It is not necessary to borrow everything. Using less credit cards can help reduce creditor debt.

For more details: John Desbois at (289)928-8883

12/02/2022

HELOC FACTS: SERIES 2
What is the Interest Rate on a HELOC?
Home Equity Lines of Credit are offered with variable interest rates. This means that your HELOC interest rate will change with the bank or financial institution's prime rate interest changes.
As with any variable rate product, the lender will either give you a discount or charge a premium on their current prime rate. For example: If their prime rate is 5.95% and your HELOC interest rate is prime plus .20% your actual interest rate would be 6.15%. And then, on the flip side, if you're HELOC interest rate is prime minus .20%, Your actual interest rate would be 5.75%
To put that into context, if you had a balance of $100,000 with an interest rate of 6.15%, your monthly interest payment would be ~$512.50
Best HELOC Rates in Canada
HELOC is a line of credit style of loan for borrowers who want a high credit limit and a lower interest rate. Generally, interest is much lower than in unsecured alternative loans like personal loans or credit cards. as with any financial product it's not always about the lowest rate, it's important to understand the terms and conditions of the products you are looking to apply for. Many low-rate products come with conditions that can cost you much more in the long run.

For more details: John Desbois at (289)928-8883

12/01/2022

HELOC FACTS: SERIES 1
Total Debt Service Ratio
Whether we know it or not, everyone has a total debt service ratio (TDS). By paying down lending on your personal finance side greater than the monthly interest payments, you'll open the credit portion of you TDS. This may not guarantee you get the prime lending rate, but likely much better interest rates. Other factors like consolidating debt or previous bankruptcy may impact loan eligibility and amount. if you are considering paying down debts, it is important to speak with a professional to understand the best way to go about it. We commonly see individuals taking what they believe to be positive actions that result in negative consequences for their credit score.

For more details: John Desbois at (289)928-8883

11/30/2022

How Does HELOC Work in Canada?
For a home equity line of credit in Canada, the application must be from a financial institution. Many, if not all, of the financial institution offer some sort of stand alone HELOC or couple it will other mortgage products that include a HELOC portion.
The best type of line of credit product for you will depend on whether you're borrowing the maximum amount, how much available credit you have and whether you're looking for a fixed interest rate or you'll entertain variable interest rates. A few offered by Canadian banks are as follows: TD Home Equity Flexline which uses a revolving credit. As you pay down your mortgage, you open your available credit in the HELOC. This allows you to more immediately access cash and improves overall cash flow.
According to the TD Home Equity Flexline website, there are many HELOC advantages including a variable interest rate based on current market conditions. This allows for a potential lower interest rate on the home equity line.

For more details: John Desbois at (289)928-8883

11/29/2022

What is a Home Equity Line of Credit?
Home Equity Line of Credit (HELOC) can help borrowers utilize the equity in their homes. Unlike a regular line of credit, a HELOC is secured against a property and therefore the interest rate will be lower than an unsecured loan.
Individuals typically have their Home Equity Lines of Credit with the same bank as their mortgage. It's important to understand that they are two different products that are both secured against the value of your home. Borrowers would be required to make their regularly scheduled mortgage payments plus a monthly interest-only payment on the outstanding balance of their HELOC.
In the event of the sale of the home or the client transfers the mortgage to another financial institution, both the mortgage and the HELOC portions would need to be paid in full.
A HELOC in Canada can be a maximum of 65% of your home’s appraised value if you borrow from a federally regulated financial institution, such as a bank. Or, if your lender combines your home equity line of credit limit with the balance remaining on your mortgage, it can be up to 80% of your home’s value.

For more details: John Desbois (289)928-8883