REFINANCE
A refinance, or “refi” for short, refers to the process of revising and replacing the terms of an existing credit agreement, usually as it relates to a loan or mortgage. When a business or an individual decides to refinance a credit obligation, they effectively seek to make favorable changes to their interest rate, payment schedule, and/or other terms outlined in their contract. If approved, the borrower gets a new contract that takes the place of the original agreement.
Reasons you may want to refinance:
Home ownership is something very important for many Canadians. Home ownership is the start to increasing your net worth and building your financial future.
Reasons to purchase property:
Debt consolidation involves refinancing multiple debts into a single, larger loan to streamline repayment. By consolidating debts, individuals can often secure more favorable terms, such as a lower interest rate or reduced monthly payment. This financial strategy is commonly used to manage various liabilities, including: credit cards, business debts, auto loans, and other high-interest expenses that weigh you down financially.
Key takeaways:
A home equity line of credit (HELOC) is a line of credit that uses the equity you have in your home as collateral. The amount of credit available to you is dependent on the equity in your home, your credit score, and your debt-to-income ratio. Because HELOCs are secured by an asset, they tend to have higher credit limits and much better interest rates than credit cards or personal loans. While HELOCs usually have variable interest rates, there are some fixed-rate options available.
Renewing your mortgage early means renegotiating the term and interest rate before it officially matures. Keeping an eye on market changes is crucial for financial security in real estate. Regularly checking your current mortgage helps you spot opportunities for lower rates or better terms, no matter how long you’ve had it. While some mortgages allow early renewal anytime, others may have a small prepayment charge. Even with a fee, early renewal can often be a smart move for better terms.
What is a Mortgage Pre-approval?
A mortgage pre-approval is a process that provides you with important information to help you with your home search.
When you get pre-approved for a mortgage, you’ll find out:
Applying for a mortgage pre-approval doesn’t commit you to one single lender. However, getting pre-approved does guarantee that the mortgage rate you are offered by a lender will not change for 120 to 160 days.
By “locking in” your mortgage rate, you’re protected if interest rates rise while you’re shopping for a home.
