New 2025 Program Allows Homeowners to Refinance Up to 90% for Secondary Suites: What You Need to Know

indi Mortgage • October 18, 2024

On October 8, 2024, the government announced a new program that will take effect on January 15, 2025, allowing homeowners to refinance up to 90% of their home’s value to create secondary suites. This is a significant increase from the current refinancing limit of 80%. The program aims to provide homeowners with more flexibility to unlock their home equity and add additional legal units like basement suites or laneway homes, provided they meet municipal zoning requirements and are not used for short-term rentals.


The program comes with specific guidelines, outlined by CMHC (Canada Mortgage and Housing Corporation), that include:

  • Eligibility: Homeowners must already own their property, live in one of the existing units, and plan to add additional fully self-contained suites.
  • Refinancing Details: Homeowners can refinance up to 90% of the property's value, including the value added by the new units. The maximum property value, once the new units are built, must not exceed $2 million.
  • Loan Parameters: The loan-to-value limit will be 90%, and the maximum amortization period is 30 years. Any additional financing must not exceed project costs.


To give an example, under this new program, if a home is valued at $800,000, homeowners could now refinance up to $720,000 for building a secondary suite—$80,000 more than the previous limit of $640,000.


This program could be particularly beneficial for homeowners who have recently purchased their property and built up a moderate amount of equity, offering them an opportunity to create an income-generating suite or expand their home without needing to sell. As housing affordability continues to be a pressing issue in many parts of Canada, adding secondary suites could also contribute to easing the rental supply shortage.


While this program represents a significant step forward in unlocking home equity for homeowners, we are still awaiting specific guidelines from lenders. These rules will clarify how lenders will approach refinancing applications under this program. Stay tuned for further updates as more information becomes available from financial institutions.


This program is expected to spark significant interest, particularly from younger homeowners or those with growing families, as it offers a pathway to enhance both living space and long-term financial stability. Homeowners looking to leverage this new opportunity should consult with mortgage experts to fully understand the potential benefits and ensure they are making informed decisions.


If you're interested in how this program could benefit you or want to explore refinancing options to add a secondary suite, get in touch with a mortgage professional today.

Is It the Right Time to Refinance? 5 Signs You Should Consider It

By indi Mortgage • February 26, 2025
Refinancing your mortgage can be a smart financial move, but how do you know if it’s the right time? Whether you’re looking to lower your monthly payments, access home equity, or consolidate debt, refinancing can offer valuable benefits. Here are five key signs that it might be the right time to refinance your mortgage in Canada. 1. Interest Rates Have Dropped One of the most common reasons Canadians refinance is to secure a lower interest rate. Even a small decrease in your mortgage rate can lead to significant savings over time. If rates have dropped since you took out your mortgage, refinancing could help you reduce your monthly payments and save thousands in interest. ✅ Tip: Check with your mortgage broker to compare your current rate with today’s market rates. 2. Your Financial Situation Has Improved If your credit score has increased or your income has stabilized since you first got your mortgage, you might qualify for better loan terms. Lenders offer lower rates and better conditions to borrowers with strong financial profiles. ✅ Tip: If you’ve paid off debts, improved your credit score, or increased your savings, refinancing could work in your favour. 3. You Want to Consolidate High-Interest Debt Carrying high-interest debt from credit cards, personal loans, or lines of credit? Refinancing can help consolidate those debts into your mortgage at a much lower interest rate. This can make monthly payments more manageable and reduce the overall cost of borrowing. ✅ Tip: Make sure the savings from refinancing outweigh any prepayment penalties or fees. 4. You Need to Free Up Cash for a Major Expense Many Canadians refinance to access their home’s equity for renovations, education costs, or major life expenses. With home values rising in many areas, a refinance could help you tap into that value while still keeping manageable payments. ✅ Tip: Consider a home equity line of credit (HELOC) if you need flexible access to funds. 5. Your Mortgage Term is Ending, and You Want Better Terms If your mortgage is up for renewal, it’s the perfect time to explore refinancing options. Instead of simply accepting your lender’s renewal offer, compare rates and terms to see if you can get a better deal elsewhere. ✅ Tip: A mortgage broker can help you shop around and negotiate better terms on your behalf. Is Refinancing Right for You? Refinancing isn’t always the best move—there can be penalties for breaking your current mortgage, and not all savings are worth the switch. However, if you relate to any of the five signs above, it’s worth discussing your options with a mortgage professional. Thinking about refinancing? Let’s chat and find the best option for you!

How To Establish New Credit

By indi Mortgage • February 26, 2025
If you’re new to managing personal finance and you want to learn about credit, you’ve come to the right place. Establishing new credit is a bit of a catch-22. To build a credit history, you need credit. But it’s hard to get credit without having a credit history. So, where do you start? Well, the first thing you should know is that building credit takes time. It’s not something that happens overnight. If you’re looking to secure mortgage financing, you will want to have a minimum of two trade lines (credit cards, loans, or lines of credit) with a minimum limit of $2500, reporting for at least two years. If you don’t have any credit yet, the best time to get started is right now. However, that may be difficult because, as we've already identified, without a credit history, most lenders won’t feel confident about taking a chance on you. What’s the solution? Consider a secured credit card. With a secured credit card, you make a deposit upfront that matches the amount you want to borrow. A reasonable amount would be $1000 deposited on a single secured credit card. You then use your secured credit card to make household purchases and regular utility payments, paying off the total balance each month. If you default on the money borrowed for whatever reason, the lender will retain the money you put up as collateral. When looking for a secured credit card, be sure to ask whether they report to the two nationwide credit bureaus, Equifax and TransUnion. If the credit card company doesn't report, the credit card account will be useless for your purposes; move on until you find a company that reports to both credit bureaus. Once your secured credit card begins reporting to the credit bureaus, you begin to have a credit score; usually, this takes about three months. Now you can start to seek out a second trade line in the form of an unsecured credit card. Don’t forget to ensure that this card reports to both of the credit reporting agencies. Another option at this point could be a car loan. From here, you simply want to make all your payments on time! But what happens if you’re looking to secure mortgage financing before you have a fully established credit report? Well, if you have someone who would consider co-signing, you can certainly go that route. The mortgage application will depend on their income and credit report, but your name will be on the mortgage. Hopefully, when the mortgage is up for renewal, you’ll have the established credit required to remove them from the mortgage and qualify on your own. Although establishing credit takes a minimum of two years, it really begins with putting together a plan. If you’d like to discuss anything credit or mortgage-related, please get in touch!
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