Mortgage Refinancing

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If you’re looking to get a better interest rate, or you need to increase your cash flow to help loved ones, achieve your dream goals like home renovations or the big vacation, then mortgage refinancing could be the best option for you.

Is mortgage refinancing a good option for you now?

Great question!

Everyone has different reason why they may consider refinancing their home loans.

Which of these reasons best fits your current financial situation?

You’re struggling to pay the bills : Are you currently struggling to make your monthly mortgage payments? If so, refinancing could potentially lower your monthly payments and provide some relief.

Lower interest rates: 

If rates have significantly dropped since you obtained your original loan, refinancing could save you a considerable amount of money over time.

Variable Rate to Fixed Rate:

You many want to change from a variable interest rate to a fixed interest rate if interest rates are climbing, so you can lock in a lower rate and have more financially consistency for several years.

Shorter mortgage term:

You might have a lot of income coming in, and wish to choose a higher monthly mortgage payment so you can pay off your mortgage faster. Keep in mind that this results in higher monthly payments though.

If you are considering refinancing your mortgage, here are some of the biggest questions we help people with every day.

What is mortgage refinancing?

Mortgage refinancing is the process of replacing your existing mortgage with a new one that has better terms and conditions. It involves paying off the outstanding balance of your mortgage balance and taking out a new loan with different terms and conditions.

What are the benefits of mortgage refinancing?

Refinancing your mortgage can have a lot of benefits for you in the long run. Here are a few of them:

Reduced monthly mortgage payments

Refinancing can help lower interest rates, resulting in reduced monthly mortgage payments because you have a lower mortgage rate. This can save you money in the long run. 

Predictability in monthly payments

Everyone likes predictability when it come to monthly payments. Refinancing can be used to switch from a variable-rate mortgage to a fixed-rate mortgage, providing stability and predictability in monthly payments from your mortgage loan. 

Paying your mortgage of sooner

When renewing your mortgage you have the option of having a shorter mortgage term, which means you can pay it off in less time!

Increase your cash flow!

You can access cash (cash-out refinance) by refinancing your mortgage and taking out a larger loan than your current remaining balance on your home (home equity). This can be useful for funding home improvements, paying off high-interest debt (like credit cards or your line of credit), funding education expenses, taking that dream vacation, or covering unexpected expenses. 

Do I have to stay with my current mortgage lender?

Nope! You don’t have to refinance with your current lender. You’re free to shop around and find a lender that’s best for you and will give you the lowest rates. In fact, that’s what we do as mortgage agents – we determine what your financial situation and needs are, and then find the best mortgage solution for you at the lowest interest rate.

When is the best time to refinance my mortgage?

The best time to refinance your mortgage is when interest rates are low.  Mortgage refinancing can be a smart financial move as it allows you to save money by securing a new loan with a lower interest rate, saving you thousands in the long run.

Even though interest rates might be low, you’ll still want to make sure these other factors are in place in order to ensure you can refinance, and that you’ll get a the best refinance rate:

You have a good credit score

This gives you more lender options, resulting in a potentially better interest rate. Not sure what your credit score is? We can help you find it out for FREE!

Your income is stable

You’ll have a better chance at getting a new mortgage with the best lenders as they want to see you have a steady income.

You have equity in your home

The more equity you have in your home, the more you can potentially take out.

If all of these things are in place, then refinancing is a good option. If you’re not sure about these things, we can help. 

What are the different ways to refinance?

There are several types of mortgage refinancing options available to you.

Rate and term refinancing:

This involves getting a new loan with a more favorable interest rate or term. This type of refinancing can help you save money by reducing your monthly mortgage payments or shortening the length of your loan.

Cash-out refinancing:

This allows you to borrow against the equity you have built up in your homes. This can be a useful option if you’re looking to consolidate high-interest debt, finance home improvements, or cover other large expenses. Cash-out refinancing typically results in a higher loan amount and may have a longer repayment term.

What is the cost of refinancing my mortgage?

Keep in mind that refinancing can come with costs.

Here are some of the things you should consider before refinancing your mortgage:

Refinancing Fees:

There may be a cost to refinance. Closing fees and potential prepayment penalties. Based on your existing mortgage, there may be fees associated with refinancing, or large penalties. We can help determine what those fees are, so you know exactly what you’re working with. 

How long you’ll stay in your home:  

If you’re planning to move in the near future, refinancing might not be the best option, as it can take some time to recoup the upfront costs.

Not shopping around for the best mortgage lenders: 

By just going to the bank, you’re most likely missing out on some amazing interest rate deals out there from other highly reputable mortgage lenders. It’s a common myth that only the banks have the best rates. As mortgage brokers (a broker is someone who finds the best option for you), let us shop around and find the best rates for you.

When there are higher interest rates:

Even if you need cash flow, it’s not a good idea to refinance when interest rates are higher as this will most likely result in higher mortgage payments each month.

It’s crucial to carefully calculate whether the savings from refinancing outweigh these expenses. We can help you weight the pros and cons to see if home refinancing is the best option for you right now.

What is the process for getting mortgage refinancing?

Refinancing your mortgage doesn’t have to be hard, frustrating or complicated.

  1. Work with an experienced mortgage agent who knows how to deal with your unique financial situation and who has access to many lenders in order to find the right solution for you. TIP : The banks don’t always have the best products for you, and are often limited to their own solutions.
  2. Your mortgage agent will provide you with an application to fill out, and will work hard to get you approved with the right lender. 
  3. Once approved, the you will go through the closing process, similar to obtaining an initial mortgage. 

When done correctly and keeping all the factors in mind, mortgage refinancing can provide financial flexibility, save money, and help homeowners achieve their financial goals.