Compare Lenders
Discover Popular Financial Services
Frequently Asked Questions About Home Equity Loans in TorontoÂ
What paperwork do I need to apply for a home equity loan in Toronto?
To apply for a home equity loan in Toronto, youâll need:
- I.D.
- Proof of address
- Your bank account details
- Your propertyâs full details (including information on any existing mortgages on it, and your ownership documents)
- Proof of income
- Other financial documents that illustrate all of your assets and debts
With this information a lender can then assess your financial position and whether they are comfortable lending to you.
How much can I borrow with a home equity loan in Toronto?
The amount you can borrow with a home equity loan depends on the value of your home and how much in other loans you have secured against it. You can borrow up to a total of 85% of your homeâs value. In Toronto the average property is worth $1.16 million, so this means you can borrow up to $986,000 (85%), minus the balance of any existing debt (such as your mortgage – which in Toronto averages $575,000). Some lenders also have upper limits on how much you can borrow.
What are the alternatives to a home equity loan?
If you are one of the 2 million homeowners in Toronto, you should know that a home equity loan is not the only route you have to access cash. You might also consider a home equity line of credit (HELOC), a second mortgage, or a mortgage refinancing. Each option has its own pros and cons, so be sure you understand what will work best for your circumstances.
What credit score do I need for a home equity loan in Toronto?
Each lender has different eligibility criteria, so in theory anyone – with any credit score – can access financing based on their Toronto propertyâs equity. However, most traditional lenders (like banks and credit unions) do have a minimum credit score threshold of 650. Torontoâs average credit score is 694, so most Toronto borrowers meet this criteria. And for those that donât, there are always alternative lenders to consider.
Whatâs the best interest rate I can get on a home equity loan in Toronto?
Interest rates on Toronto home equity loans can be as low as 2%, but the average is just under 6%. The exact rate you pay will depend on the lender you go to, your financial circumstances, and the property in question. Itâs important to also take into account loan fees when calculating your loanâs eventual cost.
Where can I get a home equity loan in Toronto?
As Canadaâs biggest city, Toronto offers plenty of options for its homeowners seeking a home equity loan. The list in the table above is a good place to start; there are also traditional lenders, like banks and credit unions, and a slew of online lenders, as well as some alternative lenders for those looking for more bespoke loan terms. Itâs important to make sure that wherever you go, your chosen lender is reputable. Avoid anywhere that has high fees, isnât transparent, or has bad customer reviews. With so much choice available, Torontonians should have no problem finding a lender that works for them.
Explore more
Similar products
Why Choose Smarter Loans?
Access to Over 50 Lenders in One Place
Transparency in Rates & Terms
100% Free to Use
Apply Once & Get Multiple Offers
Save Time & Money
Expert Tips and Advice