Home Equity Line of Credit (HELOC) in Canada
Access your home equity with a flexible, revolving line of credit. Use it for renovations, investment property down payments, the Smith Manoeuvre, or as a financial safety net — pay interest only on what you use. Canadian HELOCs offer prime-based rates that are significantly lower than credit cards or personal loans, and there are no prepayment penalties when you pay down or pay off your balance. We help you choose between standalone HELOCs and readvanceable mortgage products based on your financial goals, and we shop across 50+ lenders to secure the best terms available.
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Flexible Access to Your Home Equity
Your home equity is one of your most powerful financial assets. A HELOC gives you flexible, low-cost access to that equity — on your terms, when you need it.
Revolving Credit Access
Unlike a mortgage, a HELOC lets you borrow, repay, and borrow again — similar to a credit card but at a fraction of the interest rate. You only pay interest on the amount you have actually drawn, not the full approved limit. This makes it an ideal tool for managing irregular expenses like renovations, education costs, or business investments.
Readvanceable Mortgages
As you pay down your mortgage principal, your available HELOC credit automatically increases with a readvanceable product. Your total borrowing capacity stays at 80% LTV but shifts from fixed mortgage to flexible revolving credit. Products like the Manulife One and National Bank All-In-One are popular readvanceable options we help clients access.
Investment Strategy Tool
Use your HELOC for investment property down payments, the Smith Manoeuvre tax strategy, or other wealth-building investments backed by your home equity. When HELOC funds are used for investment purposes, the interest may be tax-deductible under CRA rules. Many of our investor clients use their HELOC as a revolving down payment fund for scaling their rental portfolio.
Prime-Based Rates
HELOCs offer some of the lowest borrowing rates available outside of a mortgage, typically priced at prime plus 0% to 0.50%. Because the rate is variable and tied to the Bank of Canada's overnight rate, you benefit immediately when rates decrease. Compared to credit cards at 20% or personal lines of credit at 8-12%, a HELOC provides dramatically cheaper access to funds.
Interest-Only Payments
Minimum payments on a HELOC are interest-only, giving you maximum cash flow flexibility compared to a mortgage that requires principal and interest payments. For example, a $100,000 HELOC balance at prime plus 0.50% costs approximately $600 per month in interest-only payments. You can pay down the principal whenever it suits your cash flow.
No Penalty for Early Repayment
Unlike fixed-rate mortgages that can charge thousands in prepayment penalties, HELOCs have no penalty for paying off your balance at any time. You can make lump-sum payments, pay it off entirely, and draw again later without any fees or restrictions. This flexibility makes HELOCs the most versatile equity access tool available to Canadian homeowners.
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HELOC Requirements in Canada
Qualifying for a Home Equity Line of Credit in Canada requires sufficient home equity and creditworthiness. Here is what lenders look for and how we help you secure the best HELOC terms available.
Requirements
- Minimum 20% equity in your home — standalone HELOCs are available up to 65% LTV, or up to 80% LTV when combined with a mortgage
- Minimum credit score of 600 for most HELOC programs, as lenders view revolving credit facilities as higher risk than fixed mortgages
- Proof of stable income sufficient to cover interest-only payments on the full approved HELOC limit, even if you do not plan to draw the full amount
- Property must be your primary residence or an eligible investment property and must pass a lender-ordered appraisal
- Clear title with no outstanding liens or judgments — the HELOC is registered as a charge against your property's title
- Gross Debt Service (GDS) and Total Debt Service (TDS) ratios must remain within acceptable limits after the HELOC is factored in
- Some lenders require a minimum HELOC amount of $10,000-$25,000 to justify the setup and registration costs
How We Help
- We compare HELOC rates and terms across 50+ lenders to find the lowest spread above prime — even 0.25% less saves hundreds annually
- Our team identifies readvanceable mortgage options that automatically increase your HELOC as you pay down your mortgage principal
- We advise on the Smith Manoeuvre and connect you with financial advisors to determine if converting mortgage interest to tax-deductible interest is right for you
- For investors, we structure your HELOC as a revolving down payment fund for acquiring rental properties efficiently
- We negotiate setup cost coverage with lenders — many will cover appraisal and legal fees as part of the HELOC arrangement
- If your equity is just below the threshold, we help you explore options like accelerated mortgage payments or appraisal timing to maximize your available credit
- We explain the tax implications of HELOC interest for investment use versus personal use so you can structure your borrowing to maximize deductions
Questions About HELOCs
Everything you need to know about Home Equity Lines of Credit in Canada. Can't find your answer? Book a call with our team.
HELOC Basics
In Canada, a standalone HELOC can provide up to 65% of your home's appraised value. Combined with a mortgage, your total borrowing can reach 80% LTV. For example, on a $600,000 home with a $300,000 mortgage, you could access up to $180,000 through a HELOC (80% of $600,000 = $480,000 minus $300,000 mortgage = $180,000). The exact amount depends on your home's current appraised value and outstanding mortgage balance.
Canadian HELOCs are typically priced at prime rate plus 0% to 0.50%. Unlike fixed-rate mortgages, HELOC rates are variable and fluctuate with the Bank of Canada's overnight rate decisions. You only pay interest on the amount you have actually drawn, not the full approved limit. We shop across our lender network to secure the lowest possible spread above prime for your HELOC.
Strategy & Investment
The Smith Manoeuvre is a Canadian tax strategy that converts your non-deductible mortgage interest into tax-deductible interest. You use a readvanceable mortgage to borrow against your home equity as you pay it down, invest the borrowed funds in income-producing assets, and deduct the interest on the investment loan from your taxes. Over time, your non-deductible mortgage shrinks while your tax-deductible investment loan grows. We can connect you with a financial advisor to determine if this strategy is right for you.
Yes. Many investors use their HELOC as a revolving source of funds for down payments on rental properties. The interest on the HELOC used for investment purposes may be tax-deductible under CRA rules. This is one of the most popular strategies for scaling a real estate portfolio without waiting years to save cash. Keep in mind that lenders will include the HELOC payment in your debt service calculations when qualifying you for the new investment mortgage.
Product Options & Costs
A standalone HELOC is a separate revolving credit facility secured against your home, limited to 65% LTV. A readvanceable mortgage combines a traditional mortgage with a HELOC component under one registered charge — as you pay down the mortgage principal, that amount becomes available as HELOC credit automatically. Readvanceable products are ideal for clients who plan to use the Smith Manoeuvre or who want ongoing access to equity without having to refinance.
Yes, HELOCs are available on investment and rental properties, though the terms may differ from a primary residence HELOC. Some lenders restrict investment property HELOCs to lower LTV ratios or charge a slightly higher spread above prime. The interest on an investment property HELOC used for investment purposes is generally tax-deductible. We identify the lenders in our network offering the best HELOC terms for rental property owners.
Setting up a HELOC typically involves a property appraisal ($300-500), legal fees for registering the charge on your title ($500-1,000), and potentially a title insurance fee ($200-400). Some lenders cover part or all of these costs as an incentive. There are generally no annual fees for maintaining a HELOC, and no fees for drawing or repaying funds. We compare the total setup costs across lenders and identify any promotions that reduce your upfront expenses.
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