Mortgage Add-On
You may be planning to undertake a major renovation to improve the appearance, comfort or resale value of your home. You may want to make a substantial investment, an important purchase, or a commitment to your children's education.
When you use RBC Royal Bank's mortgage add-on option, your home keeps on providing you and your family with comfort, security and enjoyment while enabling you to access extra cash when you need it.
This convenient mortgage option lets you access additional funds by simply adding them on to your existing RBC Royal Bank mortgage, based on the current appraised value of your home.
When you use the Add-On Option on a conventional mortgage, you can use the money for any purpose you choose. If you have an insured NHA or High Ratio Royal Bank mortgage, the money must be used for renovation.
Use of the Add-On Option is subject to RBC Royal Bank's standard credit approval criteria, and arrangements can usually be completed within a few days of your application.
Here's an example of how the Add-On Option works:
| 1. | Let's say the current value of your property is: | $130,000 |
| And the present value of your RBC Royal Bank mortgage, which will mature in 3 years, is: | 40,000 | |
| 2. | With the Add-on Option, you can borrow to a maximum of 80% of the current appraised value of your home, which would be: | 97,500 |
| Now subtract the present balance of your mortgage, which will mature in 3 years. You would also subtract any other liens against the property, but in this example the mortgage is the only debt: | 40,000 | |
| 3. | With the Add-on Option, you could use your home to borrow as much as an additional: | $57,500 |
If you were to borrow the additional $57,500 with the Add-On Option, your existing mortgage rate would be blended with the current rate for a 3-year term mortgage, and your monthly payments would be adjusted to reflect the new amounts of principal and interest. Your mortgage specialist will be happy to explain this in detail to you.
