Owning a home in Canada not only provides a sense of pride but also opens doors to unique financial opportunities. One of the key benefits is the ability to tap into your home equity for various financial needs. In this blog, we’ll explore five home equity borrowing options available to all Canadian homeowners, helping you make informed decisions to achieve your financial goals.
You have options, regardless of what your current mortgage lender has informed you! Big banks would have assigned a high number of our mortgage applications to higher-interest-rate home equity loans, but our team’s knowledge and rigorous reviews can put them in the first position with lower-interest-rate mortgage lenders.
This is accomplished by finding the key strengths in each mortgage application that we evaluate—a step that is frequently overlooked by mortgage lenders, who have a vested interest in pushing borrowers into higher interest rate options. If we recommend a home equity loan with a higher interest rate, we instantly put our borrowers like you on a road to lower-cost financing to ensure your long-term financial success. We leverage our comprehensive knowledge of the mortgage marketplace to continuously bring better solutions to the table by listening to our borrowers, understanding their objectives, and factoring in the six elements about their personal finances that effect their borrowing options.
Curious about leveraging your home equity? Here is the top 5 options for Canadian homeowners Empower yourself with the knowledge to make good financial choices
Here’s a look at the five home equity borrowing options available to all Canadian homeowners.
5 borrowing options for homeowners
1. A short-term home equity loan
A short-term home equity loan, such as the CannectFlex Home Equity Loan, is offered to borrowers who have a clear exit strategy. Borrowers gain access to considerably cheaper interest rates and better terms by identifying how a loan will be paid back before it is advanced, all while setting themselves up to save thousands in the future by securing a lower interest rate mortgage when it comes time to renew. We know this since 70% of CannectFlex borrowers refinanced at a reduced interest rate.
2. A new first mortgage with an ‘A Lender’
Cannect has outstanding relationships with all Tier 1 lenders in Canada as a full-service mortgage brokerage. For many of our consumers, this means that even if they have been told “no” by their primary bank or existing mortgage lender, Cannect can approve them for the loan they seek at a lower interest rate than their current lender. Cannect knows how to identify qualities in your borrower application that you didn’t know existed, so we can argue on your behalf for the highest rate possible. We have a strong understanding of what it takes to get a fantastic rate from any financial institution in Canada.
3. New first mortgage with a ‘B Lender’
A borrower may require a longer-term solution in some circumstances to restore aspects of their borrowing application, such as their credit or income. We may recommend this method when a medium-term home equity loan could be a borrower’s bridge to a longer-term reduced mortgage. It would begin with a slightly higher interest rate B mortgage, which lowers the overall cost of borrowing and is a significantly better long-term solution than a higher interest rate home equity loan. Cannect’s technology and algorithms consider all relevant costs and compute all possible outcomes to present you with the most cost-effective option to assist you in meeting your financial objectives.
4. Medium-term home equity loan to match first mortgage maturity
Cannect is not a fan of medium-term Home Equity Loans. We recognize that some borrowers require additional time to rebuild their finances. Breaking a first mortgage and incurring an expensive penalty is risky in some situations, especially if the capital is tiny. Cannect gladly provides home equity loans that properly match the maturity of an existing first mortgage in these circumstances. Once you’ve acquired a home equity loan, we’ll work with you to refinance to a lower rate first mortgage and then lead you through the process of paying off any accumulated debt as quickly as feasible.
5. Long-term home equity loan past maturity of the first mortgage
These debts are frightening for both consumers and lenders. Cannect is not in the business of making high-interest home equity loans to borrowers who are unable to repay the loan with lower-cost financing. As a lender, our purpose is straightforward: to work with clients who can benefit from our assistance. Cannect’s primary goal is to lower borrowing costs for Canadians. Our solutions are intended to assist debtors within the next 36 months. Longer-term loans are extremely rare and are only used when all other options have been explored.
Ready to Explore more
We’re here to assist you confidently navigate the home financing industry.
Try a free estimate now to compare your financing alternatives, or give us a call at 416.766.2666 to discuss your possibilities right away.
