MCAP Fusion HELOC — verified terms, the limit you can actually draw, and the risks (25 Oct 2026)

The product, verified from MCAP's own documents

MCAP Fusion is a Combined Loan Plan (CLP) — a mortgage plus a revolving line of credit registered as one charge. Key terms, from mcap.com and MCAP's Fusion product sheet:

• Revolving LOC limit: up to 65% of the home's value. Combined mortgage + LOC: up to 80%.
• Automatically readvanceable. Principal you pay down on the mortgage becomes available credit:
• combined LTV ≤ 65% → readvances 1:1 ($1,000 principal paid = $1,000 more LOC room)
• combined LTV 65-80% → readvances at 82.5% ($1,000 paid = $825 more LOC room; the other $175 is locked in as permanent debt reduction)
• No penalty to pay off the LOC segment at any time. Interest-only payments allowed on the LOC.
• Mortgage segments keep normal penalties; prepayment privilege is 20% of original principal per year plus a 20% payment increase.
• Minimum loan $50,000; maximum uninsurable $2M in the GTA. Owner-occupied only.
• Qualification: minimum 650 credit score, GDS/TDS 39%/44%, and the HELOC limit is qualified at contract rate + 2% (or the MQR, whichever is higher) — not at the actual rate.

The number that actually matters — and the mistake to avoid

Available HELOC = (65% × home value) − current mortgage balance.

MCAP's own HELOC blog page gets this wrong in its worked example: it states the 65% revolving cap and then calculates the limit as (80% × value) − mortgage balance. Using 80% overstates your room by 15% of your home's value — on a $900,000 home that is $135,000 of credit that does not exist, and a plan built on it fails at the commitment stage. Use 65%.

Price

• Prime + 0.50% is MCAP's Fusion LOC pricing (the launch rate, and the standard structure across mainstream lenders). At today's prime of 4.45% that is 4.95%.
• Prime is 4.45% (Bank of Canada overnight target 2.25% + the standard 220 bp bank spread), unchanged since the BoC held on 2 September 2026.
• The next BoC decision is 28 October 2026 — three days from now. If a HELOC at prime + 0.50% is the plan, waiting three days costs nothing and could reprice the whole loan. Fixing the rate before that announcement is a coin-flip you do not need to take.

Documents MCAP requires

• Fully qualified income documentation (this is a requalification, not a courtesy — T4s/NOAs and employment letters, or business financials if self-employed through the clinic corporation).
• AVM or appraisal — MCAP orders it after the signed commitment and covers the cost on funded files.
• Payout authorization, current mortgage/renewal agreement, fire insurance particulars, insurer certificate (if the mortgage is insured), and proof municipal and school taxes are paid and current.
• Discharge fee covered by MCAP up to $300 on transfers.

The two things that can sink this plan

1. Interest deductibility is not automatic. Under ITA s.20(1)(c) interest is deductible only where the borrowed money is used to earn income from a business or property with a reasonable expectation of income — capital gains do not count (Shell Canada, Ludco, Singleton). Borrowing to buy a leveraged ETF chosen for growth is the classic CRA denial fact pattern. If the QLD position pays little or no distribution, assume no deduction and model the 4.95% as an after-tax cost.
2. Which QLD is it? ProShares Ultra QQQ (QLD) is US-listed 2x leveraged — not permitted inside a TFSA/RRSP, and 2x daily resetting means a 4.95% HELOC against it is leverage on leverage. BetaShares QLD is ASX-listed and is not available through Questrade or Wealthsimple at all — only a broker with ASX access (IBKR, for example) plus AUD FX. That changes the mechanics before the borrowing does.

What to ask MCAP on the call

1. What is my actual available limit at 65% once the current balance is subtracted — in writing?
2. What rate, and is it prime + 0.50% or a negotiated spread, and is it fixed or floating?
3. Is the availment a new charge or an increase to the existing Fusion charge (this decides whether there are legal fees at all)?

Sources: mcap.com Fusion Mortgage product page; MCAP/FCT Fusion product sheet (qualification, documents, penalties, limits); MCAP HELOC blog page; Bank of Canada policy rate table (2.25%, held 2 Sep 2026, next announcement 28 Oct 2026).