# Looking to apply for a HELOC



## internalaudit (Jan 27, 2017)

So my wife and I are shopping for a HELOC but we are experiencing some roadblocks because some of the lenders I reached out to do not want to be in second position (doesn't allow second charge lending) behind our mortgage lender Merix Financial. 

I've tried HSBC and RBC so far.

I did reach out to a credit union in Ontario, Tandia, months back and got approval but had to let the deal fall through as my wife wasn't too keen on applying for a HELOC.

We availed of some low interest rate balance transfer options to invest the proceeds in the equities market and they will be coming due. Our bets have kinda paid off but I'm thinking there may be more upside to our holdings so I would rather pay the balances as they come due and of course start paying the HELOC down as our pay come in every week.


I also heard about Manulife One with the $17/month fee but was wondering if any of you know of other lenders (likely not the Big 6 banks) who are willing to do a second charge lending behind Merix Financial. I think most HELOC's are not at prime + 1/2 but I don't mind paying a bit more if I need to.


Also, have all credit unions in Ontario moved to the 65% LTV? I don't anticipate requiring to borrow too too much but of course a lender willing to still do 80% LTV is something I would consider first. 65% LTV should be doable for our needs though but since I'm starting from scratch, any lender offering 80% LTV is fine too.

Many thanks in advance.


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## Mortgage u/w (Feb 6, 2014)

Manulife is your best bet. Not many are willing to register a 2nd as a HELOC. Most will simply hold a HELOC as a single collateral charge.

DOF has changed the rules a while back - no HELOC can surpass 65% LTV.

Depending on the amount you need, try blending your current mortgage for the amount you need. You can also wait at maturity and switch to a lender like Scotia who offers a great STEP. You will be limited to 65% so if you need to top up to 80%, the great thing about STEP is you can get a fixed portion for the balance all while keeping 1 charge registered.


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## fireseeker (Jul 24, 2017)

Mortgage u/w said:


> You can also wait at maturity and switch to a lender like Scotia who offers a great STEP.


I think BMO has a similar product:
https://www.bmo.com/main/personal/loans-line-of-credit/homeowner-readiline#


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## internalaudit (Jan 27, 2017)

Thanks so much both.

Manulife it is likely then. I spoke to Tandia Credit Union almost a year ago and they were willing to extend 80% LTV but the special rate they were offering was around 20 bps above the typical HELOC rate. I guess most CU's may have voluntary complied with OSFI on the 65% LTV.

I'll check with Manulife first since I we will have the HELOC balance paid off in two to three years, at the most.


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## MarkLinMTG (May 2, 2018)

When is the renewal for your Merix coming up?

Manulife allows 2nd position HELOCs but with the assumption that upon maturity of your Merix, you would roll everything together into 1st position with Manulife.
You can choose not to renew with Manulife, but if you don't, your HELOC rate in 2nd position goes up by +1.00%.

Depending on how you plan on using the funds, it could also make sense to refinance and amortize the payments.


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## internalaudit (Jan 27, 2017)

Thanks for the additional info Mark. I didn't know that's how it worked. No wonder when perusing Manulife One's webpage, it seems a mortgage was included in the package. 

Renewal isn't until October 2020.

Right now, I don't think refinancing makes sense because we are locked in at 2.39% and doing so will just bump our mortgage rate up.


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## MarkLinMTG (May 2, 2018)

You're locked into a great rate so I also agree that refinancing doesn't make sense.

Manulife actually offers 2 products — Manulife Bank Select (which is like your traditional mortgage) and the Manulife One like you mentioned.
The Manulife One is your HELOC, mortgage, and every day banking account rolled into one. You can setup automatic deposits for payroll or OAS/CPP, automatic withdrawals for bill payments, make e-transfers, write cheques, and create "sub-accounts".

The sub-account is probably what you're seeing as the mortgage component included in the package. The Manulife One allows you to create multiple sub-accounts to lock in any portion into a fixed rate term. For example, you can create a sub-account for a car purchase, one for home reno project, and another for an investment so you know exactly how much interest to write-off.

I recommend it to my clients that may be planning retirement as it is more flexible than a reverse mortgage or other HELOCs.


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