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There is a good chance that your home has increased in value and with today’s low rates, and that you have also paid down your mortgage balance.

Did an unexpected circumstance leave you with credit card debt? Have you been putting off some necessary home repairs or renovations? If so, there are several ways to consider using your home equity to pay down debt and improve cash flow.


You may have the option of refinancing your existing mortgage for a larger amount. The difference between your existing mortgage balance and the amount your new mortgage may be approved for would be available cash to you for debt consolidation, renovations, etc. Typically, this option allows you to refinance up to 80 percent of your home’s value. For example, if your home is now valued at $400,000, 80 percent of this value is $320,000. If your current first mortgage balance is $250,000, the available new cash would be $70,000. The main benefit to this type of refinancing is interest rate as you are adding to your first mortgage which is more attractive to a lender.


Sometimes, refinancing your first mortgage is not an option for one reason or another. There may not be enough equity, there may be no option to do so with your current lender, there could be credit or income issues, etc. In this case, you may still be able to use your equity to take out a second mortgage.

A second mortgage is an effective option if you require a fixed amount of funds and if it will improve your credit, cash flow, home value, etc.


A home equity line of credit can be considered if you feel you need to re-use the facility and have the wherewithal to pay down the debt. With a HELOC, you can re-use the facility as you wish and you can also pay it down as you wish. As it is based on the equity in your home, a HELOC is secured and therefore the interest rates are usually very attractive compared to an unsecured line of credit.

Any questions? Let us know. Call us at (905) 875-4594 or fill out the form to get started!


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