How Does a Refinance Appraisal Affect Your Loan in Ontario?

Short answer: when you refinance a home in Toronto, Hamilton or anywhere in Ontario, the appraised value is the number your lender uses to decide how much you can borrow. A higher supported value means more available equity; a lower one can shrink the loan or change its terms.

Why Does a Refinance Need an Appraisal?

When you bought, the purchase price gave the lender a value to work from. In a refinance there is no new sale, so the lender needs an independent, current opinion of what the home is worth. That value is the foundation for the whole loan.

What Is Loan-to-Value?

Loan-to-value (LTV) is your total mortgage divided by the home's value. Lenders use it to measure risk.

• Example: on a home appraised at $900,000, a $720,000 mortgage is 80% LTV, and an $810,000 mortgage would be 90%.
• The usual cap: for a regular refinance with a federally regulated lender, borrowing is generally limited to 80% of the appraised value.
• Equity available: the room between your current balance and that limit is roughly what you could access, subject to the lender's income and credit rules.

Private and alternative lenders set their own limits; see appraisals for private mortgages. Your mortgage broker or lender can confirm exactly what applies to you.

What If the Appraisal Comes In Low?

If the value is lower than you hoped, the lender will usually reduce the amount it offers. Options may include borrowing less, providing information the appraiser may not have had, such as recent renovations, or talking to your broker about other lenders. An appraiser can only change a value when there is supporting evidence, so documentation is your best tool.

It can also help to understand why values differ. A neighbour's sale may have been a larger home, a renovated one or a sale from a stronger month. Appraisers adjust for those differences, so the final number may not match the highest sale on your street.

How Can You Prepare for a Refinance Appraisal?

• Make a list of upgrades with dates and rough costs (kitchen, bathrooms, roof, windows, mechanicals)
• Have permits for additions or basement apartments ready
• Make sure every room, the basement and the mechanical room are accessible
• For rental units, have current leases and rent amounts handy

It also helps to know your own numbers going in: your current balance, any line of credit secured on the home and roughly how much you hope to access. That way you can see quickly whether the appraised value gets you where you need to be.

Tidiness doesn't change the value, but easy access and good records help the appraiser capture everything the home offers.

Can You Order Your Own Refinance Appraisal?

Some homeowners order an independent appraisal first, to see where they stand before applying.

One important point: many lenders only accept appraisals ordered through them or from appraisers on their approved list, and some need the report addressed to them. Check with your lender or mortgage broker before you book, so you do not pay for a report they cannot use.

How Much Does a Refinance Appraisal Cost?

At Best Home Value, appraisals start at $370 for a condo or townhouse, $475 for a detached or semi-detached house and $700 for a 2-4 unit property in the Greater Toronto and Hamilton Area. Your exact fee is confirmed in writing within one business day, before anything is booked. See our full fee table.

How long does it take?

The signed PDF is typically delivered 2–3 business days after the inspection, prepared by a designated appraiser to the Canadian Uniform Standards of Professional Appraisal Practice (CUSPAP). Learn more about our purchase and refinance appraisal service.

What You'll Need to Get Started

• The property address and your lender or broker's requirements
• A list of renovations and any permits
• Contact details for arranging access

Related Articles

• Appraisals for private mortgages
• Should I get an appraisal before buying a home?
• How to set the right list price

This article is general information, not tax, legal or financial advice. Please speak with your accountant, lawyer or lender about your situation.