Refinancing & Home Equity
Your home has probably built more equity than you realise. The useful questions are how much of it you can actually reach, what it costs to get at, and whether you should.
The one number to start with: 80%. Most lenders — including private lenders and mortgage investment corporations — will lend to about 80% of your home’s value in total, first mortgage included. That’s a ceiling, not a promise, and there’s a real difference between the room being there and being approved for it.
The answers in this centre
- How much equity can I actually borrow against my home?
- Should I refinance my first mortgage or take a second mortgage?
- Is a HELOC better than a second mortgage for my situation?
- What does it cost to break my mortgage?
- My home has lots of equity but my income is fixed. Can I still refinance?
More answers being added — how a renewal differs from a refinance, and when to start the conversation before maturity.
The three ways to reach your equity
| Route | What happens to your first mortgage | Best when |
|---|---|---|
| Refinance | Replaced — possible penalty | Your current rate isn’t worth protecting |
| Second mortgage | Untouched — no break, no penalty | You’re holding a low rate you’d never get back |
| HELOC | Depends on the structure | You want access rather than a lump sum |
The second row is the one most people don’t know about. If you’re sitting on a mortgage rate you couldn’t get today, breaking it to access equity can cost far more than the borrowing itself. A second mortgage leaves it completely alone.
Before you decide anything
Work out the total dollar cost, not the rate. Legal, appraisal, lender and broker fees all come out of what you receive. On a short term, those can matter more than the interest rate.
And check the penalty on your existing mortgage. Variable is usually around three months’ interest. Fixed is the interest rate differential, which can be a much larger number and is the single most common unpleasant surprise in a refinance.
What to do next
Send me your numbers — value, balance, what you’re trying to do — and I’ll tell you which route is actually cheaper for your situation.
Sometimes the honest answer is to take less than you’re offered, or nothing at all. If that’s your situation, I’ll tell you.
Talk it through → · Back to all answers →
General information about Ontario mortgages — not financial, legal or mortgage advice. Lender guidelines vary and change. Every file is reviewed individually.