Home Equity Loans in BC – Get Approved to Use Home Equity
One of the greatest things about living in the Vancouver, BC, area is the recent increase in home values. For people living in the right part of the area (including Victoria and the surrounding region) these increases mean that their home equity is shooting upward, making them eligible for home equity mortgage loans.
Why is that? Your home equity doesn’t have anything to do with the price you paid for the house, or the amount of the mortgage you originally took out. The equity you have in your house today is the difference between the appraisal value of your home and the amount you still owe on that mortgage.
Consider that house you bought in Chilliwack, Prince George, Kelowna, Nanaimo, or another city in BC. You paid $700,000, and you put $200,000 down, so your original mortgage was $500,000. You’ve paid down another $250,000 in principal, which means you still owe $250,000 on the mortgage. You order an appraisal and learn that the home is now worth $825,000 on the market. That means that you have $575,000 in equity in the house, even though you’ve only paid $450,000 toward the purchase price.
Home equity loans allow you to take out some of that equity you’ve built up for expenses that are more than you were expecting — or are simply surprises. Did you need to max out some credit cards because your spouse had an illness and missed nine months of work? Did your daughter choose a university that was more expensive than you thought it would be? Most people don’t buy a house planning to use the equity for something else down the line, but the good news that if you have it, you have a giant cushion in place for those expenses.
Use your home equity to take out a loan
It can be for a set amount and a set term, or use it to establish a home equity line of credit (HELOC). The amount for each will vary depending on the equity you have in the house, your current income and your credit score. If you take out a home equity loan in BC, you’ll have two mortgage payments now, so make sure it’s something you can accommodate in your budget. With a HELOC, you have a credit card or book of special checks that you can use to pay for those items (college tuition, that new boat, the cruise deposit) as you need to. That way you don’t borrow any more than you absolutely need to.
Amansad Financial has relationships with traditional and private lenders that assist throughout BC to help connect you with the home equity financing that you need. We pride ourselves on being able to match our clients with the very best loan for their situation. Get in touch with us and let us help you get started!