Why would you get a mortgage for more than your house is worth? One reason would be to renovate it with a purchase-plus-improvements mortgage.
Some lenders will give you an extra 10% to enhance a property, figuring that the improvements will inflate the homes value accordingly. Note that the extra 10% is only reimbursed after you make the improvements. There are other catches as well, as this Toronto Star story explains.
Last modified: May 1, 2007