Short answers to the questions Albertans ask most about borrowing against their home’s equity. Each answer links to a fuller guide.
What is an equity mortgage?
A mortgage where the lender relies mainly on your home equity rather than only your income documents and credit score. See What Is an Equity Mortgage?
Do I need good credit?
Not necessarily. Equity lenders still check credit, but recovering credit isn’t always a deal-breaker if your equity and plan are strong. See equity mortgages after a credit setback.
Do I need to prove my income?
You’ll need to show you can make the payments, but many equity lenders accept income evidence a bank wouldn’t, such as bank statements. See when your income is hard to prove.
How much can I borrow?
It depends on your home’s appraised value, what you already owe, and the lender’s maximum loan-to-value. See how to calculate your home equity.
Is it more expensive than a bank mortgage?
Usually, yes: a higher rate and often a lender fee. See rates and fees.
Can I get one on a home I own outright?
Yes. A mortgage-free home can be a strong position to borrow from. See getting a mortgage on a paid-off home.
Is this the same as a reverse mortgage?
No. A reverse mortgage has no regular payments and is only for older homeowners. See equity mortgage vs reverse mortgage.
Can I move to a bank later?
Often. Many borrowers use an equity lender until their income documents or credit improve. See moving back to a bank.
What’s the biggest risk?
Your home secures the loan. If payments become unmanageable, you could lose equity, or the home. See the risks of borrowing against your home.
Do I need a lawyer?
Yes. In Alberta, a lawyer prepares and registers the mortgage at Land Titles and should explain the terms before you sign.
This article is general information, not financial or legal advice. Lender requirements, rates and fees change and depend on your situation.