A buyer moved up to a detached home, kept his current home as a rental and funded the 20 percent down payment from a HELOC on the old property. An alternative lender approved it in two days.
Client details are changed or removed and figures are rounded to protect privacy.
Written by A.I.M.I. Collective Mortgage Group, Brokerage editorial team
Published October 2026 · Last reviewed 5 October 2026
Official sources: Office of the Superintendent of Financial Institutions (OSFI), Financial Consumer Agency of Canada
A family wanted to move to a detached home in a better fit neighbourhood, closer to schools and friends, without selling the home they already owned. That meant carrying two properties, finding a 20 percent down payment without selling, and convincing a lender the new home really was the principal residence.
About $125,000 a year in a remote role, six years in the same industry.
About $65,000 a year from a commission based business running since 2021, mostly referral driven with low expenses.
An existing HELOC with a limit of about $217,000, enough to fund the down payment.
Scores above 800 and every account rated R1 with no late payments.
About $200,000 was drawn from the HELOC on the current home and declared as the down payment source, with closing costs from the buyer's own resources.
The new HELOC balance was debt serviced at its interest only payment, about $825 a month at prime plus half a point.
The departing home was converted to a rental with expected rent of about $4,200 a month, offsetting its carrying costs.
The note set out the reasons for the move: schools within walking distance, a better neighbourhood and being close to family friends.
Salaried income with tenure, plus self employed income with about five years of history and a clear description of where the business comes from.
includes the HELOC payment
A HELOC on another property can fund a down payment when the lender accepts it and the payment is in the ratios.
Show the HELOC payment the lender will use, not the balance today. It keeps the TDS honest from the start.
When a client keeps their old home, write down why the new one is home. Lenders ask.
Self employed income with several years behind it can carry real weight. See self employed mortgages.
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