Improvements to your home can add to its value and appearance. However, paying for any home reno project is the most challenging part.

In the end, the financing you'll want for your project has a lot to do with the kind and cost of the renovations you're doing. Some programs will allow you to stretch beyond what a typical lender will let you do while remaining compliant with the rules.

One option to source additional funds is mortgage refinancing. It will let you replace your existing mortgage with a new one of a more significant amount. You can use the difference between the balances of two mortgages for renovations. It's critical to know when to refinance a mortgage to avoid fees and penalties. That's where my expertise comes into play.

There are two options to refinance your mortgage:

  1. End of the term when you have to renew your mortgage. In this case, a lender won't apply any fees.
  2. Refinance during the mortgage term. You'll have to pay penalties for breaking your mortgage. Remember that you'll pay a discharge fee if you change lenders and refinance with a new one.

Also, it's crucial to consider the mortgage rate since the loan amount and the payments will be higher.

A home equity line of credit and Refinance Plus Improvements are other options for funding a home reno. I can uncover these programs' unique features and qualification requirements for you.

Before recommending any solution, we'll look at the cost of your renovation, whether you need all the money upfront, how much time you need to repay your loan and more.

How much are you looking to borrow?

Our clients often
ask us

icon-info
View all questions

To start, you need to understand the basic math of investing. You either buy low and sell high, or you buy well and keep for a while. Ask yourself, which one do you want to do, and how will your numbers look? Together, we can work out some scenarios and prepare you for your search.

Every investment comes with its own set of risks. We can consider mitigation strategies to help you manage some risks, but not all are inherent in a given investment. Real estate is no different. The plan you choose will have its own set of risks. How you manage or minimize them will depend on your unique approach.

Buying a property out-of-the-box means you’re not inheriting old problems, and the place will come with a warranty. As they say, the new car smell is never free.

An upfront conversation about your numbers can put some of these elements into perspective and help you plan your real estate portfolio around your goals, abilities, and lifestyle.

Cash flow is what you make every month minus what you spend. What you spend every month should include a buffer for any unplanned expenses (which you should be saving up for anyways). Positive means you’re in the plus and visa-versa.

The bank views cash flow-positive property as a more robust investment and is more likely to lend preferentially against it.

How do you estimate and budget for cash flow? That’s a more extensive conversation that we can have.

The answer is it depends. First, you should ask at least three people: your accountant, mortgage broker, and lawyer. There are considerable implications of doing so, but I’ll stay in my lane and speak only to the borrowing ones.

When you finance a property held in a holding company, there are rules you have to follow. In addition, you will:

  1. Limit your choice of lender and product options.
  2. Incur costs and be bound by some additional conditions of financing.
  3. Forfeit some privileges you may be otherwise entitled to when buying a property as an individual. And notwithstanding all of the above, it still makes sense to go the hold-co route for some specific scenarios.

Call professionals, take good notes, and run some solid numbers to make sure this makes sense for you - before you make a move. Ask to be referred to tried and true professionals who can help you improve the quality of the answers you get.

Investment concepts, where the outcome hinges on elbow grease or downright speculation, are often harder to sell to a lender. These projects will hold the operator (you) to a higher standard of financial ability to service this debt should your project hit choppy waters.

In contrast, opportunities, where properties have a strong cash flow and a solid long-term value projection, will be a lot easier. Financing costs will be lower, and the emphasis will be placed on the property itself rather than its investors.

A home equity line of credit (HELOC) is secured credit. Your home acts as a guarantee that you will repay the money you borrowed.

Up to a maximum credit limit, you can borrow money, repay it at your discretion, and borrow again. It typically comes with higher rates than their regular mortgage counterparts. You can best use them for consolidating short-term and/or recurring costs.

There are other factors to consider, and every situation is different. Talk to a professional to help weigh your options.