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If you were to ask around, you’d probably find friends, family, colleagues and neighbours who have taken a home equity loan at some point in their lives. You may have heard them call it something else because a home equity loan is often referred to as either a second mortgage or a HELOC (home equity line of credit). A home equity loan is both of these things, quite simply because both second mortgages and HELOCs require that your home have equity.
A home equity loan/second mortgage uses your home as collateral but without changing anything about your first mortgage. The reliance on home equity to qualify actually trumps credit history or how much income you’ve got. As a result, eliminating these as deciding factors means a higher rate of approvals. Don’t know if you’ve got home equity? Don’t worry, keep reading – we’ll get to that soon.
If you have bad credit or have recently lost a job you may be worried about qualifying for a loan right now. We understand, but you don’t have to worry. Even if you have bad credit or a history of bankruptcy, our lending partners approve based on equity. Essentially, all you need to qualify for a home equity loan – is home equity. Many of our clients are homeowners who have been turned away by their bank for damaged or bad credit or not meeting strict income requirements. We encourage anyone who has been turned down by a major bank to rely on our common-sense lending practices. Apply with us and benefit from our access to a wide variety of solutions that we tailor to your specific circumstances.
You can use a home equity loan for any purpose you like. However, the type of loan you get may have an impact on how you spend. The first type of home equity loan is a fixed term loan. Typically, the loan would be advanced in one lump sum payment with a fixed interest rate. It is usually easier to qualify for this type of loan because the requirement for income or great credit isn’t a factor. The second type would be a HELOC that is predetermined for a set amount. However, rather than advancing all of the funds at the same time, you can access funds when you need them. The arrangement resembles a credit card agreement right down to how you pay your bill. You make payments based on what you owe and then you can re-use the credit you’ve paid off.
So, consider what you need the funds for and which arrangement will work best for you. Once you’ve been approved you can use your loan to:
The good news is that home equity loans are not based on your income or credit history. A second mortgage or home equity loan is based on how much equity you’ve got. If you don’t know how much equity your home has accumulated, use our online Home Equity Calculator tool to find out. Our lenders will take a practical approach and approve you for a reasonable home equity loan that does not leverage 100% of the value of your home. Essentially, you may be able to go up to about 85% and this includes your first mortgage balance too. Your loan will be determined based on how much equity you’ve got but also on if you’ve got enough to leave 15% behind when you borrow.
Your bank is not likely to be the place where you’ll find the loan you’re looking for. Especially if you’ve got damaged credit – the bank may turn you away. Our lenders don’t have to fit your application into a specific set of criteria to approve your loan. The major banks are following strict lending criteria that makes a home equity loan more challenging to secure. Even if you’ve got significant equity and don’t need to borrow all of it, you’re better off going to an expert like us. We have fostered connections with lenders who will care more about equity than anything else.
Our experience and lenders can work to your advantage when it comes to borrowing the money you need. We’ve been helping Canadians with mortgage needs for more than 30 years. Canadians who have been turned away by their banks and almost given up on finding a lender. We understand if you’ve got bad credit or can’t verify your income for us. Let’s chat about your options, with a home equity loan you could change your life. With a second mortgage your equity is your key to financing – let us help you unlock the door.
While no lender will allow you to borrow 100% of the value of your home, most lenders will entertain lending as much as 85% of the value of your home less any mortgages or liens on your home. Using the scenario below, a borrower might be entitled to borrow as much as $140,000.00
If this still seems complicated, check out our Home Equity Calculator to see how much you might qualify for. Secondmortgage.ca specializes in home equity loans and we pride ourselves on finding the most flexible terms with the lowest rates and payments in the industry.
We’ve been approving home equity loans for what seems like an eternity and if you are having a hard time getting financing, we can help you find a solution. Our home equity loans are based on equity, with little credence paid to income or credit. We can often have your home equity loan approved the same day you complete an application. Give us a call for a free consultation at 1-866-306-2637 or apply online and put your equity to work!
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