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What is a home equity loan?
A home equity loan uses your home as collateral to secure the funding you need. These types of loans do not impact your existing first mortgage and approvals are based on the amount of equity accumulated in your home.
Credit and/or income are rarely taken into consideration when you apply for a loan of this nature. With this in mind, we routinely arrange home equity loans for people with bad credit.
In order to determine the amount of equity in your home, subtract any existing mortgages or liens from the estimated current value of your property.
For example, people often ask: How do I calculate the equity in my home? It’s simple, if you your home is worth $350,000.00 and your remaining mortgage is $200,000.00, you have $150,000.00 in equity.
You can use our handy home equity calculator to see not only how much equity you have, but also how much you can borrow using the equity in your home.
Types of home equity loans
While mortgage loans and installment loans can be confusing, home equity loans are simple. There are two types of home loans.
First, we will review fixed term loans. These loans are generally short term and given to the borrower as one lump sum. The interest rate is usually fixed and monthly payments are based on the amount advanced. A home equity loan for bad credit is generally easy to qualify for because your home is used as security
Fixed rate home equity loans are easier to qualify for because they don’t require income or credit. Transunion and Equifax credit reports aren’t given much credence, making it possible to get a home loan with bad credit.
The second type of home equity loan is a revolving loan. Most often referred to as a home equity line of credit (HELOC), which is approved for a predetermined amount.
Instead of advancing all of the funds at once, you access them as you need them, like a credit card. Payments are based on what you owe and credit can be re-used once it’s paid off. It is important to note that HELOC’s are more complicated to qualify for and most lenders want to see good credit and proof of income.
While it is possible to get a home equity line of credit with bad credit, it is a little more challenging than a home equity loan. Income and credit are often reviewed more thoroughly but they are still possible. One of the best ways to improve your chances of qualifying is to work with a broker who specializes in these types of home loans
Why take a home equity loan?
A homeowner may want to tap into their equity for many reasons. Home credit loans in Canada can be a great way to access cash fast. A home equity loan can be used for:
- Consolidating high interest debt such as payday loans
- Home renovations
- Pay outstanding debt for property tax arrears
- Stop a power of sale
- Rebuild your credit if you have a bad score
- Eliminate Canada Revenue Agency debt
- Adding liquidity to your bank account
Beyond this, the possibilities are yours to discover. Turnedaway.ca has made qualifying for a home loan easy.
I have equity but bad credit.
Finally, if you have equity but bad credit, don’t worry. As a rule, Turnedaway.ca’s lending partners approve loans based on the amount of equity in your home, not your credit score. To begin with, we provide home equity loans for people in Canada with bad credit who have been turned away due to their credit or for not meeting income requirements.
If you’ve been turned away by one of the major banks for any reason, we offer a wide variety of solutions to fit almost every circumstance. Not every lender has adopted the same tight restrictions the major banks are following, we still offer home equity loans based on common sense lending practices.
Why choose Turnedaway.ca?
Because, our name says it all! We’ve been helping people obtain home equity loans for over 30 years. If you’ve been turned away by the bank for a loan in Canada, we can help find the financing you need. Improve your credit score while getting the support your need.
In this day and age having bad credit or facing financial challenges are almost common place. Our team at Turnedaway.ca understands this and we are here to help.
We’ve helped a lot of people. See what they have to say!
Marilyn & Bob T
We can’t thank you enough for all your help with our mortgage. We were skeptical about filling out an online application but we had tried several banks and due to our credit, couldn’t find anyone to help us. Getting a call within 15 minutes of submitting our application to go over the application put my mind at ease but my husband and I were both shocked to receive a call the same day with an approval. We are still amazed at everything you did considering how difficult the banks made our situation sound. Again, from the bottom of our hearts thank you so much!
Marilyn & Bob T, Whitby Ontario.
Dave & Sharon S
My wife and I felt completely lost and didn’t know where to go after being declined by our bank of 18 years. We were so relieved once you advised us there are still lenders that value a mortgage based on merits other than just your credit rating. We had never missed a payment on our mortgage for 18 years and to hear our bank say they couldn’t help us even though we owed virtually nothing on our home was heartbreaking. I couldn’t be more grateful that they helped out two complete strangers when nobody else would.
Dave & Sharon S, Ottawa Ontario
I can’t put into words how greatful I am to you regarding coordinating all of the activities in seeing my new mortgage go through. There are several reasons for the appreciation from my side but most importantly it will allow my daughter to continue to grow up in a home and neighborhood that she has identified as being very important to her.
I owned a home for almost 15 years and faithfully renewed at my bank every 5 years. About 14 years into my mortgage my job was terminated and I was forced to rely on credit cards to keep things going. Fortunately I found work after 7 long months but by then my credit had deteriorated and my bank wouldn’t help. I called turnedaway.ca after hearing one of their radio ads and I am glad I did. They bailed me out of a bad financial situation, got rid of all my credit card debt and got me down to one manageable mortgage payment.
John C, Toronto Ontario.