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HELOC Mortgage Rates

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Home / HELOC Mortgage Rates
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A home equity line of credit (HELOC) is a revolving line of credit secured by your home. Since a HELOC is backed by an asset (your home), you can access a lower interest rate than a traditional line of credit. For Canadians, the combined balance of their mortgage and their home equity line of credit cannot be more than 80% of their home’s value.

HELOC can be a fantastic tool for those who need ready access to cash for critical things like consolidating debts, financing a child’s education or making home renovations. The best thing about a HELOC is that you can tap the funds as you require them, so you only pay interest on the borrowed money. And, these ow variable interest rates make HELOC financing a cheaper and a great alternative to credit cards and personal loans.

HELOC Features

  1. Up to 80% of your homes value is accessible

    For Canadians, the combined balance of their mortgage and their home equity line of credit cannot be more than 80% of their home’s value. To find out how much equity is at your disposal, take your home’s value and multiply it by 80%. Then, subtract your present mortgage amount. The remaining figure is the equity at your disposal through a home equity line of credit. There is one more criteria when finding out the maximum value of the HELOC available to you. It is important to make sure that the HELOC balance shows 65% or less of yours home’s value.

  2. A revolving line of credit is used to advance HELOC funds

    In a home equity line of credit, the entire credit available is not advanced straight up. Instead, you are allowed to choose as much or as little of the HELOC, and you are only supposed to pay interest on the amount you withdraw. Interest is determined daily at a variable rate that varies with the prime rate. Traditionally, the rate attached to a HELOC is higher than a variable mortgage rate and it does not always have a consistent relationship with prime.

  3. You make interest only payments

    When you make your monthly payment on a home equity line of credit, you are only accountable to pay the interest on your outstanding balance. This varies from a traditional mortgage where you make principal payments and interest and pay your balance off over time. The holders of home equity line of credit must be more disciplined and make balance payments at their own responsibility.

HELOC Minimum amount Maximum amount (line of credit portion) Sub-divide lines Option to convert to fixed Revolving /re-advancable balance Monthly fee Second position
BMO Homeowner ReadiLine None 65% market value No No Yes No No
CIBC Home Power $10,000 65% market value No No Yes No No
Desjardins Versatile Line of Credit $25,000 65% market value No No Yes No No
ING DIRECT Canada HELOC $15,000 or $50,0001 65% market value No Yes No No No
Manulife One $50,000 65% market value 15 Yes Yes Yes Yes
National Bank All-in-One $25,000 65% market value 99 Yes Yes No No
PC Financial Secured Borrowing Account $15,000 65% market value No No Yes No No
RBC Homeline Plan $5,000 65% market value 5 Yes Yes No No
Scotiabank STEP None 65% market value No No Yes No No
TD Canada Trust HELOC $10,000 65% of market value or purchase price2 20 Yes Yes No Yes
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