Are You Ready for a Home Equity Loan?

home equity loanSometimes it’s hard to figure out if now is the right time to tap the equity in your home; after all, you need food and shelter, but your home is the only thing you can really leverage to raise money. It’s important they think about what you’re going spend your money on, have a plan for using it wisely, and understand if this is really the right decision. Working with one of our Canada mortgage brokers can help you understand the benefits and the pitfalls of borrowing against your home. You’ll want to have your first mortgage payoff is much as possible, be free and clear of any liens, and have good credit before you try and take out another mortgage on your home.

What is a home equity loan?

A home equity loan allows you to trade the equity in your home (known as collateral) for money from a lender. This is a secured debt, so if you default you run the risk of losing your home. It’s very important to borrow only what you can afford and to be very careful about how quickly you repay. Since you’ll be relying on the equity in your home, you can get underwater if you borrow too much at a high interest rate and just can’t repay it fast enough.

How much equity do you have?

You’ll need to figure out just how much equity you hold in your home before you start thinking about taking out a second mortgage. Check your monthly statement to see how much you owe (principal + interest!) and subtract it from the most recently appraised value of your home. This way you’ll be able to figure out just how much you own of your home and how much equity you have available. You can borrow up to 80% of your available equity, but most won’t want to borrow this much.

How quickly can you repay?

Before you take out a second mortgage or home equity loan, you’re going to need to make sure that you can repay your mortgage fast. Working with one of our Canada mortgage brokers we’ll help you create a payment schedule that will help you save thousands of dollars – but we’ll also be there to help you find the cheapest lender with the best service too. The last thing you want to do is take out a high interest second mortgage with a low loan to value ratio; if you want to best, work with us.

Should you tap into your equity?

This isn’t a question we can help you with until we speak with you. Give us a call today or contact us on our site to set up a free consultation about your home equity loan. We’re here to help you answer any questions you may have, and we’ll work hard to help you figure out if now really is the right time for you to start tapping into the equity in your home.

Open Up the Tap on Your Equity with a Home Equity Loan

home equity loans

You’ve been making timely payments all these years, isn’t it time your home started to give a little back? With the right mortgage broker (us!) and a home equity loan you can get all the money you need to consolidate your debts, send your kids to university or even start a business. With any kind of equity loan the devil is in the details and you don’t want to try and negotiate this one your own. Let’s explore how they work and why you would want one.

What is Equity?

If you don’t know, equity is how much you have invested in your home. If your mortgage(s) are completely paid off you have 100% equity. If you’re still paying off half your house you have 50% equity. You can figure out how much equity you have in your home by subtracting the remaining debt from the most recently appraised value of the home. This way you’ll be able to know exactly how much of a home equity loan you can take out.

Don’t Take Out a Large Home Equity Loan

Just because you’re approved for a big amount doesn’t mean you should actually borrow that much! You’ll want to work with one of our Toronto mortgage brokers; we understand the market, the tricks lenders pull and we’ll work hard to help you get the best equity loan possible. Every situation is different, don’t take a cookie cutter mortgage that just isn’t in your best interest. Also be careful about what the terms are before you sign on that dotted line.

Plan Ahead

When it comes to home equity loans you need to have a plan for the future. Why are you borrowing this money? Will you get some kind of return on it? Are you going to be able to pay it back? How much will you need to pay each month to pay back your home equity loan? If you don’t know the answers to these questions one of our Canada mortgage brokers can help. We have a lot of experience when it comes to home equity loans and we’ll be able to show you how to get the right loan.

Your Equity is Important

Each time you make a mortgage payment you’re socking away money for the future – that future is now. Why should you get robbed of your equity because you didn’t know any better? We’ll work with you to help you understand your rights and obligations as a borrower and to really understand what you’re signing. From finding the right mortgage lender to signing we’ll be there with you for every step of the way.

You’ve worked hard for your home and you shouldn’t have to lose it. Working with us as your Toronto mortgage broker will help you not only get the money you need now but keep your home in your future for years to come. Don’t get a bad deal, get the right deal!

Discover our home equity loans today!