This is How Refinancing Can Improve Your Financial Circumstances

Posted on 17th July 2015

With interest rates hovering near record lows and expected to stay low for the foreseeable future, you may be wondering if now is a good time to refinance and save money. If you haven’t considered the benefits of refinancing your home, you may be missing out. Not only does refinancing with lower interest rates help you save money, you can also increase your personal and/or family’s wealth.

Now the Perfect Time to Refinance?

Refinancing your mortgage is a great way to access money using the equity in your home. This could be a less expensive way to borrow money than taking out a traditional loan.

As per government guidelines, Canadians can borrow up to 80% of their home’s appraised value when refinancing through traditional sources, such as banks or credit unions. For example, if your home is worth $500,000, you can access up to $400,000 when refinancing. Or, if your home is worth $300,000, you can refinance up to $240,000. Some private lenders, however, will go up to 85% or even 90% of your home’s value. If you’re looking for a higher amount, an independent agent can help find a refinancing open that works best for you.

Why Refinance?

Canadians refinance their mortgages for a number of reasons. The most popular reason to refinance in Canada is to consolidate debt. In fact, $20.6 billion of home equity was used to repay consumer loans over the last year.1

Refinancing is a great way to consolidate debt acquired from high interest rate credit card balances and loans. That’s because the interest you pay when refinancing is significantly lower than what you’d pay with a credit card. By consolidating your debts at a lower interest rate, you can save money and bundle all of your debt into one place.

Another popular reason to refinance is to access the liquidity of homes. In 2014, $17.4 billion was refinanced for home renovation; $7.7 billion for investments; $6.6 billion for purchasing, including tuition; and $10.3 billion was used for other purchases.

If you want to reduce your monthly obligations, you might want to refinance your mortgage by selecting a longer term. While this will cost you more in interest, it will reduce your monthly payments. The Nation’s Refinancing Leader

Mortgage rates have been cut in half over the last eight years so it continues to be an excellent time to refinance. That said, there’s a lot to consider when it comes to refinancing. With tens of thousands of dollars in potential savings at stake, it’s a decision you don’t want to take lightly.

At the same time, refinancing can be a stressful process. If you’re not given objective advice and don’t possess a full understanding of all the details of your refinancing agreement, it can be difficult to make an informed decision.

If you’re thinking of refinancing to save money, consolidate debt , or access the equity in your home, give the licensed, independent agents at a call. Our comprehensive review and calculation process will help you make the most informed decision.

To find out if now is the right time to refinance, contact today or apply online and a mortgage specialist will set up an appointment at your earliest convenience.

1. Marr, G., “Great news coming if you’re renewing a mortgage, you’re about to save money,” Financial Post web site, November 18, 2014;

1. Marr, G., “Great news coming if you’re renewing a mortgage, you’re about to save money,” Financial Post web site, November 18, 2014;

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