HELOCs Explained: How Much Equity Can You Actually Access?

A home equity line of credit (HELOC) is revolving credit secured against your home, meaning you can draw funds, repay them, and draw again up to your approved limit — more like a credit card than a traditional loan with a fixed schedule.

Under Canadian (OSFI) guidelines, the HELOC portion alone is capped at 65% of your home's appraised value. But if you also have a mortgage on the property, your combined secured debt (mortgage plus HELOC) is capped at 80% of home value — and in practice, that combined limit is usually the tighter constraint for anyone who doesn't already own their home outright.

Because HELOCs are revolving, many lenders offer interest-only payment options — you only pay interest on the amount actually drawn, not the full limit. That flexibility is useful for irregular expenses (a renovation done in phases, for example) but can also mean the balance never shrinks if you only ever make interest payments.

HELOC rates are typically variable, tied to prime, and reset immediately when the Bank of Canada changes its policy rate — unlike a fixed-rate mortgage term, there's no rate protection built in.