HOME EQUITY LINE OF CREDIT

Use the power of your home equity to secure a lower interest rate and save!

With an equity line of credit also known as a HELOC, you can secure a lower interest rate to help you save big on interest while you borrow. Use these funds for home renovations, vacations, investments; consolidate debts - or anything else you want. If you need extra funds and would like the flexibility to borrow and repay as frequently as need be, a HELOC may be your answer.

A HELOC is simply a revolving Line of Credit that allows you to use the equity in your home to borrow money at any-time without having to go to your bank and re-apply for a loan or credit card. You never have to apply again as long as you own your home. Also, because it is secured against your home you get the best rates. If you like the idea of paying your mortgage at your own pace, a HELOC provides you with a flexible alternative to a traditional mortgage.

How is the payment determined?

The interest rate on a HELOC is based on the bank prime rate and floats with prime (unlike a fixed rate mortgage the HELOC is not a guaranteed interest rate). Payments must be paid monthly and are based on a minimum payment of interest only. You can choose to pay it off, make a lump sum or simply just pay the interest only payment, the choice is yours.

If you would like to protect yourself from interest rate increases and establish regular fixed payments to help you plan your budget, you can choose to convert all or any portion of your Home Equity Line of Credit balance to the Fixed Rate and lock in a competitive fixed mortgage interest rate at any time. (Some lenders will charge you new legal fees and appraisal fee to make this change).

How do you determine how much HELOC you will have available to you?

With the Home Equity Line of Credit, you can have access to up to 80% of the appraised value or purchase price of your home (whichever is lower), less any prior outstanding mortgage charges. As your mortgage balance decreases, your available credit increases. If your value of your home goes up in the future you can re-apply to the bank to increase your limit. Generally you will incur an appraisal fee to determine the current market value of your home.