At first glance, this may seem appealing. But before signing on the dotted line, consider any applicable fees and the risks of combining different credit products.

Readvanceable mortgages make it more complicated and expensive to switch lenders to get a better interest rate when your mortgage is up for renewal. You may need to repay all credit products tied together under the readvanceable mortgage. And because it's secured by a collateral charge against your home, there are additional legal fees you wouldn't incur when moving to a traditional mortgage.

“Lenders can demand that you repay your home equity line of credit, lower your credit limit or increase your interest rate at any time,” cautions Lucie Tedesco, commissioner of the Financial Consumer Agency of Canada. “This would impact all credit products bundled together in your readvanceable mortgage.”

Remember that a home equity line of credit is secured using your home as collateral — meaning if you can't pay back the money you owe, your lender can take possession of it.

Find more information online at canada.ca/money.

www.newscanada.com