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[OP]
Deal Addict
Aug 16, 2015
1136 posts
469 upvotes

HELOC

my mother is going to heloc her house to buy a condo. and she is planning on selling the house later.

blueshore offered her 3.45% and 2000 in fees to borrow 700k. does anyone have any advice or know if that is a good rate?

She is ready to jump but I figured I should ask around first.
7 replies
Sr. Member
Dec 26, 2019
723 posts
1246 upvotes
I think most big banks are offering 2.95% (prime + 0.5%). And my fees for setting my HELOC was around $700 at BMO
Deal Expert
Aug 22, 2011
37751 posts
23837 upvotes
Center of Universe
Prime +.5% with TD and all fees were waived.
Sr. Member
Oct 12, 2005
674 posts
594 upvotes
Vancouver
Tangerine advertises prime - 0.1% on HELOC (2.35%). I have heard they charge around $700 for registration. (They require you either have no mortgage or a Tangerine mortgage to qualify).

Simplii has the lowest registration costs around, only $150 in a lot of cases. Their rate is prime + 0.5% (2.95%) usually. They will also give you a HELOC behind another lender’s mortgage in some cases.
[OP]
Deal Addict
Aug 16, 2015
1136 posts
469 upvotes
apparently the banks/credit unions will not even give her a heloc. she is getting the run around. I guess her salary or whatever is too small to borrow the 600k. (the price of the condo she wants to buy)

now she has been setting up some bridge financing at almost 6% interest with a 2% fee to be charged on the 600k. (losing 12k). I guess it's through some subprime lender or whatever. I don't like the sounds of it. Anyone have any advice or commentary?
Deal Fanatic
Apr 5, 2016
5933 posts
4379 upvotes
Calgary/Vancouver
Bridge Financing is always expensive because it's technically an unsecured loan. That may be the only option if she's not approved for a HELOC.

If she is 55+ years old, she could try reverse mortgage as income is not required and she only needs 55% loan to value. Interest rates are still higher than conventional mortgages but should be lower than bridge financing.
[OP]
Deal Addict
Aug 16, 2015
1136 posts
469 upvotes
bomber17 wrote: Bridge Financing is always expensive because it's technically an unsecured loan. That may be the only option if she's not approved for a HELOC.

If she is 55+ years old, she could try reverse mortgage as income is not required and she only needs 55% loan to value. Interest rates are still higher than conventional mortgages but should be lower than bridge financing.
thank you. I said she should sell her house first before buying the condo?? This seems like taking on a lot of risk. the market is hot supposedly but still.
Deal Fanatic
Apr 5, 2016
5933 posts
4379 upvotes
Calgary/Vancouver
kilburn305 wrote: thank you. I said she should sell her house first before buying the condo?? This seems like taking on a lot of risk. the market is hot supposedly but still.
You can try to time the closing dates. You can have separate closing and move in dates if she is concerned about moving in and out. A really good realtor can help negotiate for the same closing date for both properties. Honestly, you don't even need same day too as long as the house is sold before the condo. This could potentially save you lawyer fees too as they are doing the purchase and sales and is holding the funds so less risk to lawyer and they can do a bundle price.

To do this effectively, she needs to do everything fast. Look at the potential condos she likes and keep a list so she can ballpark the price. Then list the house and see how many offers you get. Key point is only put an offer on a condo when you have offers, otherwise, you run the risk of buying the condo and not being able to sell the home.

If not, maybe sell the home first, she can move in with you until she finds a condo.

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