Getting a lower interest rate is not the only reason to refinance your mortgage. It can also be used for several financial reasons. Below-mentioned is some of the reasons for mortgage refinancing in Toronto:
#1 Ensuring you get a lower interest rate
Refinancing your mortgage can help you save a lot of money over time as you can get a lower interest rate. However, it depends on the size of the outstanding mortgage, including the prepayment penalty. If your current mortgage has a variable interest rate, then every three months you can expect to pay a penalty on interest. If your mortgage has a fixed rate, then you will be expected to pay the greater of the three months interest. Don’t let penalties be a stumbling block on deciding whether to refinance your mortgage.
#2 Allows you to access the equity in your property
Through mortgage refinancing, you could potentially access up to 80% of your property’s value to pay off any outstanding debts. Additionally, the money can also be used for investment opportunities, home renovations, including taking on a Home Equity Line of Credit (HELOC).
#3 Debt consolidation
If there is enough equity present in your house, you might be able to utilize the built-up equity in your house to pay-out high-interest debts such as credit card bills, car loans, a line of credit and much more. Additionally, you can also consolidate debt with the help of several mortgage refinancing options available.
#4 Helping you to finance the purchase of property
If you have a significant portion of the equity in your property and are interested in investing in real estate, you could withdraw equity from your current property through mortgage refinance and use the amount as the down payment to purchase the property. Additionally,interest may be deducted, which is usually missed when using your current savings.
#5 Funding your education
As parents, the best thing we can do for our children is give them a sound education, including being good role models to them to look up to. By giving them the best education possible, they can become more responsible citizens, as well as build a solid and stable foundation for themselves. With the country’s rising education costs, most individuals do not set up adequate funds aside and eventually suffer from the financial burden of paying a lot more than what they bargained for their children’s education costs. The cheapest and the best way to bridge the gap is through a mortgage refinance.
#6 Funding your house renovations
If you are spending more than $20,000 on renovations for your property, it can be less stressful for you to take out a mortgage refinance than a loan or a line of credit. Also, in today’s real estate market, your current mortgage may no longer be the best-suited option.
#7 It helps pay off your unexpected medical bills
Just like the economy, life is uncertain, and unexpected medical expenses may arise to take care of certain treatments. If your insurance policy has restrictions that can put you at risk financially, a mortgage refinance may offer you a quick and straightforward solution.
For further enquiries on mortgage refinancing reach to a trusted mortgage broker in Toronto.
