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How Do Home Equity Loans and Second Mortgages Differ?

If you own a property, you may have heard about the advantages of getting a second mortgage or home equity loan to pay for renovations or debt consolidation.

But what are these advantages, and how do home equity loans compare to other types of credit?

Given that the average Canadian mortgage takes decades to pay off, some homeowners are naturally hesitant to take out a second mortgage on top of their existing one. 

However, the benefits of a second mortgage or home equity loan outweigh the risks as these types of loans are frequently the cheapest and most responsible.

This article will assist you in deciding which choice is ideal for you and how to apply if you’re interested in taking out a home equity loan or second mortgage or if you want to learn more about home equity loans and their benefits. 

You can also find where to contact a mortgage specialist in Ottawa through this blog. 

How Do Home Equity Loans and Second Mortgages Differ?

Before you can comprehend its benefits, you must first comprehend how a home equity loan differs from other forms of borrowing. The first two queries are about a home equity loan and how it varies from a second mortgage.

Home equity loans are secured loans of this kind and are acquired using an existing funding source (in this case, the equity you have built up through homeownership). 

In contrast to an unsecured loan like a credit card or bank line of credit, a home equity loan is secured by a real asset like your property.

Technically speaking, the only difference between a home equity loan and a second mortgage loan is that banks and mortgage agents may offer various home equity lending products, such as home equity lines of credit (HELOCs) and lump-sum loans, whereas “second mortgage” is a more general term for any loan that is secured by home equity.

Although all second mortgages are considered home equity loans, not all take that form.

Loans for Home Equity Are Used

The key benefit of a home equity loan is the ability to obtain sizable loans at lower interest rates.

The lender is taking a calculated risk based on your income, credit history, and the state of the economy when they grant your request for an unsecured loan if they have reason to believe you will be able to repay it and want to.

The lender would often demand a high-interest rate—nearly 20% in the case of credit cards—to make this risk viable. The interest on a sizable loan will climb quickly and become unaffordable.

Benefits of Home Equity Loans For Those With Poor Credit

A home equity loan can be the only method for borrowers with poor credit to get a sizable amount of credit. It can be difficult to obtain an unsecured loan if you require a sizable volume of money for debt consolidation or house upkeep if your credit score is lower than 650.

You can access various possible lenders when you use mortgage services in Ottawa to apply for a home equity loan. 

The advantage of a home equity loan is that you can create a repayment schedule that works for your current financial situation. This ensures you’ll get the money you need and a repayment plan that fits your expenditure and income. 

Your credit score will determine the interest rate you can get, but this is one benefit of a home equity loan.

Using leverage, which covers how to use your assets to make your money work for you, is necessary to make wise financial decisions. You can borrow money whenever you need it with a home equity loan at a cheap interest rate.

A home equity loan is the greatest option to obtain a low-interest rate, a manageable payment schedule, and a source of wealth secured by the expanding real estate market, whether you’re attempting to get back on track through debt consolidation or want to renovate your bathroom.


A home equity loan is a great way to finance major expenses such as home improvements, education, or medical bills. Using the home’s equity, you can get a low-interest loan that can be used for just about anything. Home equity loans also offer various repayment options, so you can choose the one that best fits your needs. And finally, home equity loans can offer tax benefits, saving you money come tax time. For more information, you can also seek Ottawa mortgage services. 

Ottawa Mortgage Services provides mortgage agent services for first-time home buyers, self-employed individuals, and commercial clients. We also help with refinancing, pre-approvals, and debt consolidation. Contact us today for Ottawa mortgage services!

Ottawa Canada

A Quick Dive into the Rich History of Ottawa, Canada

Ottawa, Canada’s capital city, is steeped in a rich history that dates back centuries. From its roots as a small Algonquin settlement in 1800, Ottawa has grown into a bustling metropolis of over one million people. The city has a long and varied history, from being the home of the nation’s first prime minister to hosting the world’s largest winter festival. From its indigenous roots to its modern-day attractions, Ottawa has something for everyone to explore.

The Founding of Ottawa

The earliest settlement in Ottawa dates back over 10,000 years when the Algonquin people first established villages in the area. They called the land Kitigàn Zìbì, which translates to “Great River” in their language. In the early 1600s, French explorers and traders began to arrive, and the area became a popular trading post. 

The city was first established as a permanent settlement in 1826 when Colonel John By of the Royal Engineers arrived to build the Rideau Canal. The canal was a major engineering feat of the day, connecting the Ottawa River to the St. Lawrence River, and was a critical link in the defence of the British colonies against American invasion.

Soon after the completion of the canal, Bytown, as it was then called after Colonel By, began to develop. Bytown was officially incorporated and renamed Ottawa in 1855. Over the next few decades, the small town continued to grow and develop, becoming an important centre for lumber, industry, and trade.

Ottawa Through the Years

The late 19th and early 20th centuries saw a period of rapid growth and development in Ottawa. Many Irish and Scottish immigrants settled in the area, and the city soon became a major centre for industry and business. In 1867, the British North America Act made Ottawa the capital of the new Canadian confederation. This led to a flurry of construction as the government rushed to build the grand buildings and monuments that have come to define Ottawa.

In the years that followed, Ottawa continued to grow and develop. In the 1950s, the government began an urban renewal program, which saw the construction of new public buildings, roads, and parks. At the same time, Ottawa’s population surged as immigrants from all over the world made their way to the city.

The Modern City of Ottawa

Today, the modern city of Ottawa is a vibrant and bustling metropolis full of culture, history and entertainment. From its impressive range of museums and galleries to its bustling nightlife and fine dining, Ottawa is a city that has something to offer everyone.

Ottawa is home to a number of iconic landmarks, including the Parliament Buildings, the Rideau Canal, and the National Gallery of Canada. These sites are a testament to the city’s rich history and are a must-see for any visitor. In addition to these landmarks, Ottawa is also home to a number of unique museums, including the Canadian Museum of History, the Canadian War Museum, and the National Arts Centre.

Ottawa is also home to a number of world-class festivals and events throughout the year. From the popular Winterlude festival in February to the Ottawa International Jazz Festival in the summer, there is something for everyone to enjoy. In addition, the city also hosts an array of cultural events, such as the Ottawa International Film Festival and the Ottawa Fringe Festival.

Ottawa is also home to a vibrant nightlife and entertainment scene. The city’s nightlife caters to all tastes, from pubs and clubs to fine-dining restaurants. In addition, Ottawa is home to several parks and outdoor spaces, making Ottawa the perfect place to escape the hustle and bustle of the city.

Final Thoughts

Ottawa, Canada, is a city with a truly unique and rich history. It has undergone many changes over the years and continues to evolve as time passes. Ottawa is a city that is full of life and energy, and it is a place worth visiting if you have the chance. It is a city with a lot to offer, and its history should be explored and appreciated.

Live your best life in Ottawa with the help of Ottawa Mortgage Services. We are a mortgage agent that provides various mortgage services in Ottawa for first-time home buyers, self-employed individuals, and commercial clients. We also help with refinancing, pre-approvals, and debt consolidation. Apply now!

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8 Factors to Consider When Comparing Rent vs Mortgage in CAN

The debate of rent vs mortgage is one that has been around for years. Some people believe it is better to rent a property, while others believe that owning a home is a better investment. Pros and cons are apparent to both renting and buying, and it’s important to evaluate your options carefully before making a decision.

After all, in the very grand scheme of things, renting vs. buying a home is a big decision that will have long-term implications. Continue reading to understand the different factors to consider.

1) Flexibility

Renting gives you the flexibility to move as often as you want or need to. If you need to move for work or you want to try living in a different part of Canada, it’s easy to do when you’re renting. On the other hand, once you buy a home, it can be quite the process to sell house. It’s best to look into your personal priorities.

2) Maintenance

Renting means that the landlord is responsible for most, if not all, of the maintenance on the property. If something breaks, you can simply call the landlord, and they will take care of it. When you own a house, you are responsible for all of the maintenance and repairs, which can be good if you want to have more overall control over the state of your household.

3) Affordability

Renting is usually more affordable than owning a home. When you own a home, you must pay for things like mortgage payments, property taxes, and maintenance. When you’re renting, you only have to pay for rent and utilities. This can be quite a good option for people who are on a budget. Granted, try to consider the return that you’re getting for what you’re paying out.

4) Freedom with Investments

Renting gives you the freedom to move around and invest your money elsewhere. For example, you can use the money that you would have used for a down payment on a home to invest in stocks or mutual funds. However, if you do want to get some real estate under your name, go with the alternative and look into a potential mortgage.

5) Stability

Mortgages offer more stability than renting for several reasons. First, your payments are typically fixed for the whole life of the loan, so you know exactly how much your housing costs will be each month. This stability can be helpful if your income is variable. Plus, once you have paid off your mortgage, you will own your home outright and will no longer have to make monthly payments.

6) Capital Gains

If you own a home, you can benefit from capital gains when you sell it. Capital gains are known as the profits you make from selling an asset for even more than you paid for it. This isn’t necessarily applicable when you’re renting.

7) Equity

Equity is defined as the portion of your home that a person would own outright. As you make mortgage payments, your equity increases. Homeowners can borrow against your equity or use it as collateral for a loan.

8) Simplicity

Paying rent, dealing with a landlord, and moving every few years can amount to a lot of work. However, purchasing and owning your own home allows you to work towards one simple goal, which is to have stability and peace of mind.


The final decision to rent or purchase a home is a big one. However, as you can see, there are some very compelling reasons to own a home. This is especially true for those people who are looking to invest long-term or settle down in the future.

Seeking a mortgage specialist in Ottawa? Ottawa Mortgage Services provides mortgage agent services for first time home buyers, self employed individuals, commercial clients. Get in touch with us today!

self-employed woman learning about mortgage online

What You Need to Know about Mortgages If You’re Self-Employed

If you’re self-employed, you might find it harder to get a mortgage than someone employed by someone else. Here, Ottawa Mortgage Services shares what you need to know about mortgages if you’re self-employed:

The Challenges of Getting a Mortgage When Self-Employed

For many people, self-employment is the key to achieving their professional and financial goals. However, when it comes to securing a mortgage, self-employed individuals often face unique challenges.

One of the biggest challenges is proving income stability. Lenders typically like seeing at least two years of consistent income before approving a mortgage. For self-employed borrowers, this can be a tough hurdle to clear.

Another challenge is that self-employed borrowers often have less documentation to show when applying for a mortgage. This is because they may not receive regular pay stubs or W-2 forms. As a result, they may need to provide additional documentation, such as tax returns, to prove their income.

Finally, self-employed borrowers may struggle to qualify for the best mortgage rates and terms. This is because they are often considered higher-risk borrowers. As a result, they may need to pay higher interest rates or put down a larger down payment.

Despite these challenges, self-employed borrowers can still qualify for a mortgage. It may just take a little bit more time and effort to get approved.

How to Increase Your Chances of Getting Approved for a Mortgage as a Self-Employed Applicant

You can do several things to increase your chances of approval for a mortgage as a self-employed applicant.

1. Get Your Financial Documents in Order

When applying for a mortgage, most lenders will want to see proof of your income. This is especially true for self-employed applicants.

Make sure you have your tax returns for the past few years, as well as any other documentation that can prove your income. This may include bank statements, profit and loss statements, and 1099 forms.

2. Have a Large Down Payment

Lenders often view self-employed applicants as higher-risk borrowers. As such, they may require a larger down payment than they would for someone who is employed by someone else.

Ideally, you should aim for a down payment of 20% or more. This will help you avoid having to pay private mortgage insurance (PMI), which is an extra fee that is required when you make a down payment of anything less than 20%.

3. Have a Strong Credit

Your credit score is among the most important factors that lenders will consider when you apply for a mortgage. A higher credit score indicates to lenders that you’re a lower-risk borrower, which can increase your chances of being approved for a loan.

If you’re self-employed, it’s especially important to have strong credit. This is because self-employed applicants are often seen as higher-risk borrowers.

4. Get Pre-Approved for a Mortgage

Getting pre-approved for a mortgage is a good way to show lenders that you’re serious about buying a home. It also gives you a clear idea of how much money you’ll be able to borrow.

When you’re self-employed, it’s a good idea to get pre-approved for a mortgage before starting shopping for a home. This way, you’ll know how much money you’ll be able to borrow and you can avoid looking at homes that are out of your price range.

5. Work with a Mortgage Broker

A mortgage broker can be a valuable resource when you’re self-employed and looking to get approved for a mortgage. Mortgage brokers are experts in the field and they can help you find the best loan products for your situation.

Additionally, mortgage brokers can help you navigate the mortgage process and they can provide guidance on what you need to do to increase your chances of approval for a loan.

If you’re currently self-employed and thinking of buying a home, following these tips can help you improve your chances of being approved for a mortgage.


Self-employed individuals should be aware of a few key things when it comes to mortgages. They will likely need to provide more documentation than a person who is employed by a company, and they may need to get a higher down payment. However, self-employed individuals can still get approved for a mortgage as long as they meet the lender’s requirements. You can consult one of the private lenders in Ottawa to know more about their specific requirements.

Ottawa Mortgage Services is one of the top mortgage brokers in Ottawa that can help you get a step closer to your dream of being a homeowner. Learn how we can help you today!