📅 Last Updated: September 6, 2024
✏️ Written By Lisa Rennie
🕵️ Fact-Checked by Caitlin Wood

HELOC Halifax - Compare Providers


In Halifax, there are so many loan options available that the choice between one over the other can often be a daunting task. That said, some loans in Halifax may be better than others, depending on consumers’ specific financial situations.

One unique type of way to borrow money in Halifax is through a HELOC. If you currently own a home and have built up a decent amount of equity over the years, you may be eligible to take out a HELOC to gain access to funds required to cover a large expense.

So, what exactly is a HELOC and is it the right loan option for you?

What is a HELOC?

Short for a ‘home equity line of credit’, a HELOC is a type of loan in Halifax that allows you to borrow against the equity in your home. Depending on how much equity has been accumulated, you may be eligible for a HELOC to get your hands on necessary funds.

Home equity refers to the difference between what you currently own on your mortgage and the value of your home. Generally speaking, homeowners must have at least 20% equity in their homes in order to qualify for a HELOC in Halifax.

Learn how to borrow using your home equity, click here.

How Does a HELOC Work in Halifax?

A HELOC works similarly to a credit card. Basically, you’ll be given a credit limit amount which you can borrow up to against your home equity. You can withdraw the entire amount all at once, or only take out a portion of it as the need arises.

You will only be charged interest on the portion that you withdraw and are required to pay that money back at some point. You’re then free to borrow against your credit limit repeatedly, just like a credit card.

To see more differences between credit cards and lines of credit, read this.

How Does a HELOC Differ From a Home Equity Loan?

Also referred to as a second mortgages, both HELOCs and home equity loans involve borrowing money against the equity in the home. However, they differ in that home equity loans involve a lump sum of money being provided to the borrower all at once, with the entire amount being charged interest and being repaid via installment payments.

What Can HELOCs Be Used For in Halifax?

There are a number of things that the money borrowed from home equity can be used for in Halifax. Some of the more common reasons why homeowners in Halifax borrow against their home equity in the form of a HELOC include the following:

  • Home renovations
  • Auto repairs
  • College or university tuition
  • Investments
  • Starting or growing a business
  • Consolidating debt

Cost of Buying a House in CanadaInterested in the price of purchasing a house in a certain province? Check out this infographic.

Is it a Good Idea to Take Out a HELOC in Halifax?

While you can literally use the funds from a HELOC in Halifax to be put towards just about anything, certain expenses hold more value than others. For instance, it wouldn’t be wise to borrow money against your home equity – and therefore increase how much you owe on your mortgage – to blow on a gambling spree. Ideally, the money you borrow should be spent on something that will add some value.

Using the funds to cover the cost of a home improvement project, for instance, would be a wise way to spend the money. By improving your home, you may be able to add value to it. Further, using the funds to invest in a safe, risk-free, and profitable investment can be another great way to use the money.

Click here for a look at safe vs. risky investments.

Otherwise, the funds should be used for expenses that you would need to cover anyway, rather than spending it on frivolous things that aren’t necessary. Further, this type of financing should only be considered if you’re financially comfortable with adding another debt payment into the mix. If you’re already struggling to meet your monthly payment deadlines, perhaps adding another payment might not be the right choice.

For more information about mortgages in Halifax, read this page.

Looking to Secure a HELOC Halifax?

If you’ve taken the time to assess your finances in great detail and have determined that you’re capable of handling another payment and are going to put the money to good use, then perhaps a HELOC in Halifax may be right for you. If that’s the case, let Loans Canada help you find the right lender and HELOC loan product in Halifax that suits your situation.

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