Refinancing is the practice of replacing your mortgage with different terms and conditions. This may allow you to obtain a better interest rate, reduce your payments or increase your mortgage to allow for purchases or consolidate debt.
You do not have to wait for your mortgage to mature to look at refinancing to reduce your interest rate. You can change the terms of your mortgage contract any time (costs to be discussed further down). Because the interest rates offered in the market place today may make it smart to break your mortgage, it is an option to be considered before making a final and informed decision here. You don’t necessarily have to sell your house to break your mortgage. In fact 50% of us break our mortgage for one reason or another halfway through an average 5-year term. Yes, it can come at a cost. However, we will examine the costs and determine if it’s worth it in terms of interest savings and if it is the right thing to do relative to your family goals. The cost factor mentioned earlier refers to mortgage set-up fees and the pre-payment penalty involved with breaking a mortgage before it matures. The fine print will advise what type of pre-payment penalty would be levied in the event you break your mortgage. Some mortgages only charge 3-month interest and others charge an interest rate differential charge. No matter what, we will capture all, if any costs and review them together. The refinancing has to make sense.
Refinancing for Personal Goals
Another objective for refinancing may be for home improvements and renovations, a vacation property, education, business financing, helping family members or to buy that new Harley Davidson you’ve been dreaming about (I’m guilty here). As a professional, my job is to provide alternatives and show the costs and benefits of each refinancing opportunity. At the end of the day, you will decide what’s in line with your family’s dreams.
Let a professional help you. Call 905-302-4171 today!