Can You Add a Car Loan to Your Mortgage

http://LeahCoss.ca
I'm standing here behind this car because it kind of rolls into what I wanted to explain to you today because I get this question somewhat often. For example, say someone's house is worth 200 grand and they have a car that's maybe worth 20 grand. They'll come to me and ask, "Hey, can I pull out more than 200,000 for a mortgage if I use my car as collateral so that I can take advantage of these low interest rates based on mortgages? Because getting a line of credit or a credit card, those can have much higher interest rates compared to a secured loan like a mortgage."
The quick answer for you, and this will be the answer for you for all time, is no. You cannot wrap in your car with your house and take out a loan based on that.
The mortgage is the one debt that is extremely and heavily monitored by the government. It's quite government regulated, in fact.
As you saw in the U.S. and we felt it here in Canada as well, real estate is what really made the world go around and eventually made it stop in its tracks. It made things collapse around it simply because they were giving out too much debt based on the collateral they had in its pocket, which was the houses.
So the government in Canada has a very heavy and ironclad policy. You must have five percent down, based on the value of your home. The most you can get for a mortgage is 95 percent of the value of the home at the time of your loan.
You cannot add a car on top of that, you can't add your hockey card collection, and you can't add your collection of tiaras from pageants when you were younger. You cannot add anything else to this collateral.
A mortgage is a mortgage, a loan is a loan. Two completely separate things and you'll never be able to combine them together.
At most, you can combine two properties together, but never a car, or a collection, or any other asset other than a house. A mortgage is a mortgage.
The reason that the rates are so good is based on a series of things. But definitely, the collateral that is being held, which is the house, is a fairly good piece of collateral.
Cars can get smashed up. Cars, they're just such a different beast all together.
So if you need a car loan, unfortunately, you're going to have to go with a regular line of credit type debt or rather rate, or a regular car loan rate. You're not going to be able to get these three percent and two percent rates that you're getting with a mortgage.
So I'm starting to babble now. Hopefully, that's clear. Give me a call if you need clarity on this, but no, you cannot do this.
I am Leah Coss. I am with The Mortgage Center. I am a Canadian mortgage broker; I cannot help you guys in the U.S. Hopefully, that's helped you out. So I will talk to you soon.
http://LeahCoss.ca

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