Home Renovations: Your Mortgage Options

If your house is aging one way to improve its value is to upgrade or do renovations. This can be costly and you may not have enough funds. There are financing options available for home renovations. By performing home renovations you can improve the value of the home by a wide margin. You need to assess the costs of the renovations and the time frame that you’ll need the funding for, You may need the money upfront or you might need it in tranches. The rate of interest at which you secure the loan is also important as the overall interest rate and the outset cannot surpass the overall appreciation rate of your property.

What Are The Financing Options for Home Renovations?

Here are some easy options that you can explore to secure renovation mortgage at a lucrative rate. First is home equity loans:

  • Homeowners have the option to secure credit lines that can extend up to 90% of the home value
  • As per existing norms, homeowners can also apply for second mortgage home improvement. In this case, one can apply for loans up to 100% of the home’s value
  • One can also apply for first & second position construction loans whereby the loan amount is up to 95% of the home value
  • For self-employed individuals or those with bad credit, there is an option for a bad credit home mortgage loan as well.

One can also look at credit card loans and personal loans to finance the renovation when the extent of the amount required, or the type of renovation is relatively small.

Mortgage Refinancing – Another Option for Home Renovations

Apart from this one can also opt for mortgage refinancing in a case of any major renovation project. The advantage is that the rates of interest are at par with mortgage interest rates and significantly lower than credit card or personal loan rates. In this option, you can borrow as much as 80% of the home’s value, and repayment window is also relatively longer.

Looking For Grants & Rebates

You can also explore grant and rebate options that can bring down the rate of outgo compared to the work done. The Canadian Government, both at the Federal level and in provincial capacity has several grants and rebates for home renovations that involve installing energy-saving initiatives. These include:

  • The CMHC Mortgage Loan Insurance for Energy-Efficient Homes that involve 10% premium refund of CMHC mortgage loan insurance
  • ecoENERGY Retrofit: In this individuals can qualify for grants up to $5,000
  • There are also many municipal and provincial authorities who might offer grants.


There are also rebates on some key Energy Start products across Canada which can significantly bring down the renovation cost. Ready for your home renovation? Check out your options for renovation mortgage now.  

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