Ontario mortgage help
Second mortgages in Ontario
A second mortgage adds another loan secured against the property. Compare it with refinancing the first mortgage using total cost, payment, term, and exit requirements.
What to do first
Estimate the property value and list every mortgage, HELOC, lien, or secured loan on the property.
Calculate the net funds required and all fees needed to obtain them.
Compare the second mortgage with refinancing the existing first mortgage.
Define how the second mortgage will be repaid at or before maturity.
Important considerations
Equity is not the same as borrowing roomThe property value minus secured debt is gross equity. Lender limits, qualification, priority, property, and fees reduce what may actually be available.
Second position usually costs moreFCAC notes that second-mortgage rates are generally higher than first-mortgage rates because the lender takes more risk.
Use the correct product limitHome-equity loans may usually reach 80% total loan-to-value, while the revolving HELOC portion is generally limited to 65% of the property value.