Life always changes so you also need to consider that your mortgage needs may change as well from time to time.
This may be a good time to use your high-interest credit cards and other debt into your mortgage to get one lower payment, boost your cash flow and save on interest costs. Refinancing is when you replace your existing mortgage with another mortgage with different amounts, terms and conditions. Most times, refinancing is done to either take advantage of lower interest rates or to take advantage of the increased equity in a home.
Common reasons Canadians choose to refinance:
- To take advantage of the low interest rates
- To extend the length of the term, if you are expecting the interest rate to rise.
- To access equity in your home for personal reasons such as:
- Debt consolidation (consolidate and pay off high-interest debt, such as credit card debt, etc etc)
- Pay for educational purposes
- Purchase a real estate investment property
- Pay for home renovations
- Investing in a small business or a large franchise
- Purchase a recreational property, such as a cottage, beach home, etc etc
- Refinancing often allows for better terms, including:
- Take advantage of your credit score improvements to refinance an existing high interest mortgage
- Lower your mortgage payment, adjust the length of a mortgage, switch between fixed and variable terms. In addition, your existing mortgage may no longer be suitable in today’s market. If your mortgage interest rate is 0.5% higher than the current interest rate, it may be worth considering refinancing. There may be hundreds, if not thousands, of dollars in monthly cash flow that you could be missing out on. You should review your mortgage on a regular basis, at least once a year, to determine if it is still suitable for your current situation given the current market. Contact GTA BEST MORTGAGE’s support team for more information!