Cash When You Need It: The Perk of Building Home Equity

HomeHappy • March 25, 2021

Investing in your future is the gift that keeps on giving. Owning property can create fantastic leverage, and give you opportunities to free up cash should you need it. When you borrow against your own investment, lenders often see you as a safer bet. 


Accessing the cash you’ve invested in your home can be great for debt consolidation, and for larger purchases like home renovations, making investments, or paying for education. 


Want to know more about how your home equity can work for you? 


Keep reading. 


What is home equity? 


Home equity is the portion of your home that you actually own. 


You build home equity in two ways: 


  • As you pay your mortgage.
  • If your home’s market value increases. 


Basically, it’s the difference between what you owe and your home’s current value. To calculate yours, subtract how much you still owe from the current price of your home. 


For example, if your home’s worth $450,000 and you owe $300,000 on your mortgage...you have $150,000 in home equity.


How it works


Your home equity is likely your most valuable asset. It’s a great financial tool that can allow more flexibility in your financial planning. Borrowing against what you own means you have a stake in the process, and gives lenders a solid guarantee that you’ll pay back what you borrow. This often results in better rates than a personal loan. 


First things first, there’s an approval process that determines whether you can borrow money against your home equity. Just because you have home equity, doesn’t mean you can use it. 


Note: not all lenders offer home equity financing options, and they aren’t created equally: consult us to determine your best options available.


Refinancing your home

Borrow up to 80% of your home’s appraised value, minus your current mortgage balance and any outstanding loans secured against your home. Refinancing is replacing your current mortgage with a new product. Your lender may also agree to refinance your home with one of these options: 


  • A second mortgage
  • A HELOC
  • A loan or line of credit secured with your home.


What you can expect when refinancing:


Your refinancing terms will likely be different than your original mortgage. While refinancing typically saves you money, as with any mortgage product, there are administrative fees like: appraisal fees, title search, title insurance, and legal fees. You may also have to pay a new mortgage loan insurance premium.


Click here for refinancing 101, and cover the basics of this complex topic.


Home Equity line of credit (HELOC)


Similar to your typical line of credit, a HELOC allows you to borrow money at your convenience, up to your credit limit. Typically you can access up to 65% of your home’s appraised value. Secured against your home, it’s a form of revolving credit: you can pay it back and borrow again. Much like your home, it’s there when you need it. 


What you can expect:


With discretionary access to your home’s equity, this is an option best suited to disciplined people. You’re responsible for monthly interest only payments on your outstanding balance. There’s no penalty, so it can be a great way to finance a project without modifying your mortgage. 


HELOC interest rates are variable and fluctuate with the market. There are associated administrative fees, and the terms of your original mortgage agreement may be altered.


For more details on getting a HELOC be sure to weigh the pros and cons against your needs, and consult us for expert advice. 


Borrow prepaid amounts


Have you made lump-sum payments on your mortgage? Your lender might allow you to re-borrow your investestment. Whatever you re-borrow (up to the total amount of all prepayments) will be added back to your mortgage.


What you can expect:


Your mortgage rate either stays the same or you’ll pay a blended interest rate on the borrowed amount. A blended rate combines the current market rate with your mortgage interest rate. 


With this option, you may not have to make any changes to your mortgage term. While you avoid many of the typical fees associated with borrowing on home equity, you should check with your lender. Fees vary, and your lender is the best source of specific information when it comes to borrowing on amounts you prepaid. 


Second Mortgage


The basics are in the name -- a second mortgage is a second loan taken on your home that’s secured against your home equity. You can borrow up to 80% of your home’s appraised value, minus your remaining mortgage balance. 


What you can expect:


You now have two mortgages, which means two separate payments. Both your first and second mortgages need to be paid simultaneously. 


Keep in mind, you could lose your home if you can’t make both your payments. If you default on the loan, your home will be sold to mitigate the lender’s loss. 


Since second mortgages are riskier for lenders, interest rates are typically higher. There are also administrative fees like appraisals, legal, title search, and title insurance to consider.


Reverse Mortgage


Access home equity without selling. A reverse mortgage allows you to borrow up to 55% of your home’s appraised value. Your borrowable limit depends on your age, your lender, and your home’s value. This option is not available to everyone. To qualify, you must be a homeowner and at least 55 years old. 


What you can expect with a reverse mortgage:


You only pay back your loan when you move, sell, or the last borrower dies. You aren’t required to make payments on a reverse mortgage until the loan is due, though your interest increases the longer you don’t pay. This means you may have less home equity when your loan term ends.


A reverse mortgage has higher interest rates than a regular mortgage, and can be either fixed or variable. The typical administrative fees apply. There may also be a prepayment penalty if you pay off your reverse mortgage before it’s due. 


For more information on how a reverse mortgage works, and other factors to consider consult us or click here for more information. 


Review your options


When broken down to the basics, it can seem like your options are more similar than different, but real life application is never so simple. The best way to understand your options, and what will work best for you and your family is to seek expert advice. 

Not only are you likely to save more money with a trusted advisor, it’s hard to go wrong when the service is free. Have your unique needs met by using the collective might of our fantastic team. Get the best deal and do more with your best asset. 


Quick reference table for comparing options to access your home equity:

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What To Do If You Have Missed A Payment

By HomeHappy • September 10, 2025
If you’ve missed a payment on your credit card or line of credit and you’re wondering how to handle things and if this will impact your creditworthiness down the road, this article is for you. But before we get started, if you have an overdue balance on any of your credit cards at this exact moment, go, make the minimum payment right now. Seriously, log in to your internet banking and make the minimum payment. The rest can wait. Here’s the good news, if you’ve just missed a payment by a couple of days, you have nothing to worry about. Credit reporting agencies only record when you’ve been 30, 60, and 90 days late on a payment. So, if you got busy and missed your minimum payment due date but made the payment as soon as you realized your error, as long as you haven’t been over 30 days late, it shouldn’t show up as a blemish on your credit report. However, there’s nothing wrong with making sure. You can always call your credit card company and let them know what happened. Let them know that you missed the payment but that you paid it as soon as you could. Keeping in contact with them is the key. By giving them a quick call, if you have a history of timely payments, they might even go ahead and refund the interest that accumulated on the missed payment. You never know unless you ask! Now, if you’re having some cash flow issues, and you’ve been 30, 60, or 90 days late on payments, and you haven’t made the minimum payment, your creditworthiness has probably taken a hit. The best thing you can do is make all the minimum payments on your accounts as soon as possible. Getting up to date as quickly as possible will mitigate the damage to your credit score. The worst thing you can do is bury your head in the sand and ignore the problem, because it won’t go away. If you cannot make your payments, the best action plan is to contact your lender regularly until you can. They want to work with you! The last thing they want is radio silence on your end. If they haven’t heard from you after repeated missed payments, they might write off your balance as “bad debt” and assign it to a collection agency. Collections and bad debts look bad on your credit report. As far as qualifying for a mortgage goes, repeated missed payments will negatively impact your ability to get a mortgage. But once you’re back to making regular payments, the more time that goes by, the better your credit will get. It’s all about timing. Always try to be as current as possible with your payments. So If you plan to buy a property in the next couple of years, it’s never too early to work through your financing, especially if you’ve missed a payment or two in the last couple of years and you’re unsure of where you stand with your credit. Please connect directly; it would be a pleasure to walk through your mortgage application and credit report. Let’s look and see exactly where you stand and what steps you need to take to qualify for a mortgage.

Start Smart: Get Pre-Approved for Your Mortgage

By HomeHappy • September 3, 2025
Thinking of Buying a Home? Here’s Why Getting Pre-Approved Is Key If you’re ready to buy a home but aren’t sure where to begin, the answer is simple: start with a pre-approval. It’s one of the most important first steps in your home-buying journey—and here's why. Why a Pre-Approval is Crucial Imagine walking into a restaurant, hungry and excited to order, but unsure if your credit card will cover the bill. It’s the same situation with buying a home. You can browse listings online all day, but until you know how much you can afford, you’re just window shopping. Getting pre-approved for a mortgage is like finding out the price range you can comfortably shop within before you start looking at homes with a real estate agent. It sets you up for success and saves you from wasting time on properties that might be out of reach. What Exactly is a Pre-Approval? A pre-approval isn’t a guarantee. It’s not a promise that a lender will give you a mortgage no matter what happens with your finances. It’s more like a preview of your financial health, giving you a clear idea of how much you can borrow, based on the information you provide at the time. Think of it as a roadmap. After going through the pre-approval process, you’ll have a much clearer picture of what you can afford and what you need to do to make the final approval process smoother. What Happens During the Pre-Approval Process? When you apply for a pre-approval, lenders will look at a few key areas: Your income Your credit history Your assets and liabilities The property you’re interested in This comprehensive review will uncover any potential hurdles that could prevent you from securing financing later on. The earlier you identify these challenges, the better. Potential Issues a Pre-Approval Can Reveal Even if you feel confident that your finances are in good shape, a pre-approval might uncover issues you didn’t expect: Recent job changes or probation periods An income that’s heavily commission-based or reliant on extra shifts Errors or collections on your credit report Lack of a well-established credit history Insufficient funds saved for a down payment Existing debt reducing your qualification amount Any other financial blind spots you might not be aware of By addressing these issues early, you give yourself the best chance of securing the mortgage you need. A pre-approval makes sure there are no surprises along the way. Pre-Approval vs. Pre-Qualification: What’s the Difference? It’s important to understand that a pre-approval is more than just a quick online estimate. Unlike pre-qualification—which can sometimes be based on limited information and calculations—a pre-approval involves a thorough review of your finances. This includes looking at your credit report, providing detailed documents, and having a conversation with a mortgage professional about your options. Why Get Pre-Approved Now? The best time to secure a pre-approval is as soon as possible. The process is free and carries no risk—it just gives you a clear path forward. It’s never too early to start, and by doing so, you’ll be in a much stronger position when you're ready to make an offer on your dream home. Let’s Make Your Home Buying Journey Smooth A well-planned mortgage process can make all the difference in securing your home. If you’re ready to get pre-approved or just want to chat about your options, I’d love to help. Let’s make your home-buying experience a smooth and successful one!

From Summer Shine to Fall Fine: Smart Home Projects to Tackle Before the First Frost

By HomeHappy • August 27, 2025
As patios wind down and pumpkin spice ramps up, fall is the perfect reset for your home—and your homeowner game plan. These quick wins boost comfort, curb appeal, and efficiency now, and set you up for a low-stress winter (and a strong spring market). 1) Safety & “silent leak” checks (Weekend-ready) Clean gutters & downspouts. Add leaf guards where trees overhang. Roof scan. Look for lifted shingles, cracked flashings, or moss. Seal the shell. Re-caulk window/door trim; replace weatherstripping. Test alarms. New batteries for smoke/CO detectors; add one near bedrooms. Why it matters: Prevent water intrusion and heat loss before storms roll in. 2) Heat smarter, not harder Furnace/boiler tune-up and filter change. Smart thermostat with schedules and geofencing. Draft hunt. Foam gaskets behind outlets, door sweeps on exterior doors. ROI tip: Efficiency upgrades lower monthly bills and can improve lender ratios if you’re eyeing a refinance later. 3) Fall-proof your yard (so spring you says “thanks”) Aerate + overseed + fall fertilize for thicker turf next year. Trim trees/shrubs away from siding and power lines. Mulch perennials and plant spring bulbs now. Shut off/bleed exterior taps and store hoses to avoid burst pipes. 4) Extend outdoor season (cozy edition) Portable fire pit or propane heater + layered blankets. Path/step lighting for darker evenings (solar or low-voltage). Weather-resistant storage for cushions/tools to preserve value. Neighborhood curb appeal: Warm lighting and tidy beds make a big first impression if you list in shoulder season. 5) Water management = winter peace of mind Re-grade low spots and add downspout extensions (2–3+ metres). Check sump pump (and backup). Look for efflorescence or damp corners in the basement. 6) Mini-renos that punch above their weight Entry/mudroom upgrade: hooks, bench, boot trays, closed storage. Laundry room tune-up: counter over machines, sorting bins, task lighting. Kitchen refresh: new hardware, tap, and under-cabinet lighting in one afternoon. Budget guide: Many of these land under a micro-reno budget—perfect for a modest line of credit. 7) Indoor air quality tune-up Deep clean vents and dryers (including the rigid duct). Add door mats (exterior + interior) to catch grit/salt. Houseplants or HEPA purifier for closed-window months. Fast Timeline (pin this to the fridge) Late August–September Gutters/downspouts, roof/caulking, HVAC service, lawn care, plant bulbs, exterior tap shut-off plan, path lighting. October Weatherstripping/sweeps, fire pit setup, organize mudroom/garage, test alarms, sump check, downspout extensions, dryer vent cleaning. Financing smarter: make your mortgage work for your home Annual mortgage check-in. As rates, income, and goals evolve, a quick review can free up cash flow or open options for a small fall project budget. HELOC vs. top-up refinance. For bite-size projects, a HELOC can be flexible. For bigger renos you plan to pay down, a top-up refi might make more sense. Bundle & prioritize. Knock out the high-impact, low-cost items first (air sealing, safety, water management) before the cosmetic upgrades. Not sure which route fits your fall plans? We’ll run the numbers and map the best financing path for your specific budget and goals. Quick Checklist (copy/paste) โ˜ Clean gutters/downspouts; add guards โ˜ Roof & flashing visual check โ˜ Re-caulk, weatherstrip, add door sweeps โ˜ HVAC service + new filter โ˜ Aerate/overseed/fertilize; trim trees; plant bulbs โ˜ Path & entry lighting โ˜ Drain/bleed outdoor taps; store hoses โ˜ Downspout extensions; sump test โ˜ Dryer vent cleaning โ˜ Mudroom/garage organization โ˜ Schedule mortgage review / discuss HELOC vs refi Ready to make fall your low-stress season? Book a quick fall mortgage check-up—15 minutes to see if a small credit line or a tweak to your current mortgage could cover your priority projects without straining cash flow.