A question on most people is “Can you borrow against your house to buy another house?” and this question can be asked in different ways including;
- Can I borrow against my house to buy another house?
- Can you borrow money against your house to buy another house?
- Can you borrow against one house to buy another?
- Can I borrow money against my house to buy another property?
Borrowing Against Your House To Buy Another House
If you have enough equity in your house, then yes you can borrow against your house to buy another house, provided that you qualify and meet the requirements. Borrowing against your house is referred to as re-financing, and the maximum amount that you are able to refinance on an existing house is 80% of its value.
If you already have a mortgage on the property, then you would take the value and multiply it by 80% and subtract the amount that you already owe on the property, and the remainder will be the balance/room that you have available to borrow.
Can you borrow from your RRSP buy a house
You are able to use your RRSP towards the down payment to purchase a house. It is not only reserved for those that are first time buyers. You can use this program again, if you have already used it, so long as your RRSPs have been paid back and you have not resided in a home that you or your spouse has owned for the last 4 + years.
Using home equity for down payment towards a second home is something that you have the option of doing as well. When you are purchasing a second home, or a home for a family member, you are able to put less than 20% down provided the property meets the eligible requirements and that you are able to qualify for the new mortgage, your old mortgage and all of the other outstanding obligations on your own accord, without the use of any rental income from the new property.
If you require rental income to support the qualification for the mortgage of this property, then you will need to put 20% down as that is the required down payment for an investment property. A rental property would be considered an investment.