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How much can I borrow against my home?

The 80% rule made simple: how to work out the equity in your home and how much a refinance can free up, with an example.

By David Ponce, mortgage broker

Reading time: 2 minPublished on October 19, 2026

A woman with silver hair sits on the front steps of her brick home in the fall, a mug in her hands.

In brief

As a general rule, you can borrow up to 80% of your home’s value, counting everything it already secures. So the amount available is 80% of the value, minus the balance of your mortgage and of the other loans secured by your home. The lender sets the value, then checks that your income can handle the new payments.

The number to remember

80%

As a general rule, that’s the largest share of your home’s value you can borrow, mortgage included.1

How does it work?

The calculation takes four steps, always in the same order.

  1. Start with the value of the home

    The lender sets it, often with an appraisal: a site visit, an appraiser or an electronic tool. At banks, the loan-to-value ratio (the share of the home’s value that is borrowed) is recalculated at every refinance.1 2

  2. Take 80% of that value

    That’s the usual ceiling for all the loans secured by the home combined.1

  3. Subtract what the home already secures

    Your mortgage balance, a home equity line of credit and any other loan or line of credit secured by the home. What’s left of the value once those debts are subtracted is called your equity.1

  4. What remains is the most you can free up

    It has to cover the debts to pay off and the costs of the refinance. The lender then checks your income and your debts: for example, your housing costs shouldn’t be more than 39% of your household’s gross income.3

A quiet suburban street in Quebec in early fall: bungalows, lawns and maple trees changing colour.

The home’s value sets the ceiling. Your income decides the rest.

Example

Made-up example

A home appraised at $400,000

Sylvie still owes $210,000 on her mortgage and $15,000 on a line of credit secured by her home. She has $48,000 in credit card and car loan debt.

Appraised value of the home$400,000
80% ceiling ($400,000 × 80%)$320,000
Minus the mortgage balance$210,000
Minus the home equity line of credit$15,000
Maximum amount available$95,000

Her $48,000 in debt fits within that $95,000, with room for the refinance costs.

The new loan would replace the mortgage and the line of credit: $210,000 + $15,000 + $48,000 = $273,000, plus costs. That’s under the $320,000 ceiling.

The calculation only shows what the home allows. The lender also checks her income and debts before approving.

Made-up example, to show the calculation. The value used, the costs and the amount approved depend on the lender and your file.

What are the downsides, and when isn’t it the right option?

  • 80% is a general ceiling, not a right. At banks and credit unions, a loan the lender considers non-conforming may be capped at 65% of the value.
  • Borrowing more increases your interest costs.
  • If your equity is low, the amount available may not cover all your debts. Other options then need a look.
  • The lender also has to be convinced you can pay: good equity isn’t enough if the income isn’t there.2 4 1 3

Frequently asked questions

How much can you borrow on your home?

As a general rule, you can borrow up to 80% of your home’s value, counting everything it already secures. So the amount available is 80% of the value, minus the balance of your mortgage and of the other loans secured by your home.

What is home equity?

It’s what’s left of your home’s value once you subtract your mortgage balance, a home equity line of credit and any other loan or line of credit secured by the home.

Who sets the value of my home, and what does the lender check next?

The lender sets the value, often with an appraisal: a site visit, an appraiser or an electronic tool. The lender then checks that your income can handle the new payments.

Related questions

The other guides, and our short answers to frequently asked questions.

Sources

  1. Financial Consumer Agency of Canada (FCAC), “Borrowing against home equity” (opens in a new tab), consulted on September 25, 2026.
  2. Office of the Superintendent of Financial Institutions (OSFI), “Residential mortgage underwriting practices and procedures: Guideline (2017)” (opens in a new tab), consulted on September 25, 2026.
  3. FCAC, “Preparing to get a mortgage” (opens in a new tab), consulted on September 25, 2026.
  4. Autorité des marchés financiers (AMF), “Ligne directrice sur l’octroi de prêts hypothécaires résidentiels” (opens in a new tab) (in French), consulted on September 25, 2026.

Sources checked on September 25, 2026. The examples illustrate a calculation; they don’t promise a result.

This guide gives general information, not advice tailored to your situation. Terms vary from one lender and one file to the next.

This guide is a translation of the French version, which is the reference text.

Groupe ZenFi (9498-0356 Québec inc.), a Quebec mortgage brokerage firm registered with the Autorité des marchés financiers (AMF), client number 3003043028.

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