HELOC calculator —
see your available
borrowing limit.

How much of your home equity you can actually borrow

Equity and borrowing power aren’t the same number, and the difference surprises people. You can have a large amount of equity on paper, but federal rules cap what a line of credit can reach. Two limits apply at once at federally regulated lenders: the revolving HELOC portion can’t exceed 65% of the home’s appraised value, and your HELOC plus mortgage combined can’t exceed 80%. Your available limit is whichever of those two caps binds first.

A worked example: a $900,000 home with a $450,000 mortgage

You have $450,000 of equity, but that’s not your borrowing power. The 65% HELOC cap is $585,000. The 80% combined cap is $720,000, and after subtracting your $450,000 mortgage that leaves $270,000. Because $270,000 is lower than $585,000, the 80% combined limit binds and your available HELOC is about $270,000 — not the $450,000 of equity, and not the $585,000 the 65% rule alone would allow. Pay your mortgage down and that combined headroom rises dollar for dollar.

HELOC, home equity loan, or refinance?

A HELOC is revolving and interest-only on the drawn balance, priced at prime plus a margin — ideal for staged or flexible needs like renovations, an emergency cushion, or a down payment on a second property, where you don’t want to borrow (or pay interest on) the whole limit at once. If you need a large lump sum at the lowest rate, a refinance is usually cheaper because it’s a fixed first-mortgage rate. For speed or a tighter credit file, a second mortgage can reach higher LTVs. The right tool depends on whether you need flexibility or the lowest rate.

Getting approved — and the best margin

A HELOC is new credit, so you requalify: the lender verifies income and credit and applies the stress test (you qualify at the greater of your rate + 2% or 5.25%). The margin over prime is negotiable and depends on your file — a strong borrower might get prime + 0.50% while a thinner file pays prime + 1% or more. Once you know your limit, the HELOC payment calculator shows the monthly interest on any drawn balance. We shop HELOC-friendly lenders across 100+ options to find both the room and the sharpest margin for your situation.

Sources

• OSFI, Guideline B-20: Residential Mortgage Underwriting Practices and Procedures (65% LTV limit on the revolving HELOC portion).
• Financial Consumer Agency of Canada, Home equity lines of credit (up to 65% of value as a HELOC; up to 80% combined with a mortgage).
• OSFI, Minimum qualifying rate for uninsured mortgages (greater of contract rate + 2% or 5.25%).