Getting a new HELOC? The rules just changed massively.
Link: https://www.canadianmortgagetrends.com/ ... -mortgage/Several of the Big Six banks have already adopted the policy, which requires applicants to prove they can afford the theoretical monthly HELOC payment based on the limit of that HELOC, rather than the amount that has actually been used, according to RateSpy.com founder Rob McLister, who first reported the change.
Most of the banks will act like you have borrowed the maximum amount from your HELOC and take that into account when looking at your ability to service debt. If you already have a mortgage and want a HELOC, you will find your limits to be low, or you may not even be able to take out a HELOC.
(The $1,334 figure was from the example, it could be any amount.)Even though you might have a zero balance, the bank assumes you might use all of your available credit. It therefore adds a hypothetical $1,334 a month payment to the debts on your mortgage application.
Link: https://www.ratespy.com/got-a-heloc-you ... k-11067208
Apparently the rule was to stop people borrowing from HELOCs to buy more real estate or to lend money to their children to buy more real estate.