Current Home Equity Loan Rates



Current home equity loan rates can be confusing. When we go online and use a home equity loan calculator, we will usually be quoted the most current rates.

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For a free, no-obligation conversation about current mortgage rates and your home equity loan needs, request a Complementary Mortgage Quote, or call Toll-Free 1-877-386-7745. We're waiting to help you.

Fixed mortgage rates and variable mortgage rates will both change but based on different criteria.

Current Home Equity Loan Rates: Fixed Mortgage Rates:
The fixed mortgage rates offered by lenders are based on the bond market. As the long term bond rates go up and down, so do the mortgage rates offered by different lenders.

Current Home Equity Loan Rates: Variable Mortgage Rates and Adjustable Mortgage Rates:
Both Adjustable and Variable mortgage rates will fluctuate because of changes to the Bank of Canada Rate’s prime lending rate. All lenders base their prime lending rate as a premium to the Bank of Canada Rate. Today, most institutions price their prime rate at 2% above the Bank of Canada Rate.

Current home equity loan rates need professional advice to set up

When lenders price the variable mortgage rate, they offer either a discount or a premium to their prime lending rate. For example, a closed variable rate might be priced as prime less 0.15% and an open variable mortgage might be priced at prime plus 0.80%. If the bank prime rate is 3%, then the closed variable rate is 2.85% and the open variable rate is 3.80%

Current Home Equity Loan Rates: Bank of Canada
The Bank of Canada prime lending rate is set on a 8 “fixed” dates each year. On these specific days the Bank of Canada will announce whether or not it will change the key policy rate. The changes in the Bank of Canada rate will be based on monetary policy.

In general, the Bank of Canada will have a target inflation rate range each year. If inflation is increasing or is above the target range, then the Bank of Canada will increase the prime lending rate to slow the economy. If inflation is decreasing or is below the target range, then the Bank of Canada will decrease the prime lending rate to help stimulate the economy.

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For a free, no-obligation conversation about current home equity loan rates and your home equity loan needs, request a Mortgage Quote, or call Toll-Free 1-877-386-7745. We're waiting to help you.

What is Home Equity?

The equity built up in your home is basically the difference between how much your home is worth and how much you owe. If the real estate market changed dramatically since you bought your home, then the equity would be the difference between the current market value of your house and how much you owe.

The amount you owe is not necessarily limited to the outstanding balance on your mortgage. If you have any personal loans or other liens where your house was used as collateral, those sums are also deducted from your home equity amount.

For example, if your house is worth $200,000 and you have a mortgage of $50,000, but you used your home as collateral to secure a $75,000 loan for the purchase of a new boat or vacation home, then your equity is only $75,000.

A good way to increase your equity and eliminate your mortgage quickly is to pay down a lump sum every time your mortgage comes up for renewal. Most lenders will allow you to make a lump sum payment throughout the year, but each is a little different.

Some lenders will only allow payments on an anniversary date, others will allow only on payment dates, others at any time. Some lenders will allow 10%, some will allow lump sum payments up to 25% of the original principle. Always check your commitment to clearly understand the pre-payment privileges of your mortgage.

Lump sum payments go directly towards your principle, thereby dramatically reducing the amount of interest you end up paying on the mortgage.

Current Home Equity Loan Rates: Home Equity Loan

Current home equity loan rates can be used for different purposes

A home equity loan is any loan where we use our home as collateral for the loan. We can call it a mortgage, in fact the “mortgage” is the document that is typically registered on title. This document ensures that the lender gets paid if the home is sold, or the title is transferred or if the home is foreclosed upon.

Lenders can also register caveat's on title instead. Often, they will register a caveat for a smaller amount, or if the home is used as collateral for a loan with a specific purpose. A business loan for example.

When a mortgage document is registered on title, the date of registration is noted. If there are 2 mortgage documents registered on title, the earlier date is the first mortgage and the later date is the second mortgage.

In the past, second mortgages have been considered to be a very scary proposition, with very high interest rates and limited flexibility. Today, that’s not always the case. Many clients will have a first mortgage and a HELOC. Sometimes HELOC is registered in second position and has a lower interest rate than the first mortgage.

Generally, a second mortgage is considered a higher risk, because the first mortgage has priority case of bankruptcy. Therefore, interest rates are usually much higher than a first mortgage or a home equity loan. The rate for a second mortgage is, however, often much lower than a personal loan or credit cards because the lender is using a valuable asset as collateral.

Second mortgage rates can be affected by the current home equity loan rates. Factors that will influence the rate includes:

  • Your credit rating
  • Your employment status.
  • Your ability to prove your income. If you earn cash that isn’t declared, or you write off all your income to reduce your income tax, then the interest rate may be higher.
  • Your repayment history. If you are frequently late with your first mortgage payment, you may not be able to secure a second mortgage, or any other type of loan for that matter

Before looking into a second mortgage or a home equity loan, consider refinancing. When you refinance you only have one monthly payment and only one interest rate.

If your mortgage is coming up for renewal, you need some extra cash and the current mortgage rates are very appealing, refinancing can be the best solution. Trying to refinance before your term is up could result in penalties, closing costs and other fees.

Contact Us Today!

For a free, no-obligation conversation about current home equity loan rates and your home equity loan needs, request a Mortgage Quote, or call Toll-Free 1-877-386-7745. We're waiting to help you.

When you are looking up current home equity loan rates or current mortgage rates, you will notice that something is missing. Most lenders will not publish the current rates for a second mortgage. This is because each case is different.

If you are a very high risk borrower, your mortgage broker may have to go to a private lender to secure the funds you need. Of course, your rates will still be lower than credit cards or personal loans, but the rate will largely depend on how much of a risk the lender is willing to take.

Current Home Equity Loan Rates: Obtaining a Home Equity Loan

When you apply for a home equity loan, your adviser will present all of the options available to you. You may choose to refinance the entire mortgage, take a second mortgage, get a Visa equity line of credit card or a home equity line of credit.

Each comes with its own pros and cons. Not one solution is right for every person.

Refinancing the entire mortgage – You have worked so long and hard to get your mortgage down, but suddenly find yourself in a financial bind, this may be the best option. This is very similar to getting a mortgage in the first place, except you drawing on some of the equity that has built up in your home.

If you have a good history then refinancing is often straightforward. Whether you apply with your existing lender or refinance with a mortgage broker the process is the same. You need to provide the same documentation; they both check your credit and assess the value of your home.

With second mortgage – Rates are typically higher on a second mortgage than on a first. But, in many cases this will offer lower rates than borrowing the money without collateral. The maximum value a lender is allowed to lend is up to 85% of the value of your home.

Visa equity line of credit – this option is similar to a line of credit, except you can use the money anywhere Visa is accepted. Rules vary from one lender to another, so you should talk to your mortgage broker to find the best lender for your situation.

Home equity line of credit – This works much like a bank line of credit, except that your home is used to secure the loan.

Whenever you are considering any of these options, it is best to discuss with a mortgage professional or a mortgage broker. He will be able to review your choices, compare and contrast the advantages and disadvantages of each choice and help you to make an informed decision.

Talk to your broker to decide which option is best suited to your needs. Current home equity loan rates are very low. This may be the solution you have been looking for to solve your financial needs.

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