Are you considering refinancing your mortgage during the pandemic? Here is what you need to know:
There are several reasons why refinancing now could be a good option for you. Taking advantage of the lower interest rates available to you now could help reduce your monthly mortgage payments. Also, it can help you to access the equity in your home so you could consolidate high interest.
Before you choose to refinance, there are a few of the things to consider.
- If you are breaking your mortgage early (perhaps even moving from your current lender to a new one) then there can be financial penalties for breaking that existing mortgage. You need to figure out whether these charges are small compared to the savings.
- There may also be additional fees for property registration, appraisals, etc. to consider as well. Although, if you choose to move lenders your new lender may cover some or all of these costs.
- The Home to Value Ratio (LTV) will be a factor in determining the maximum loan, or equity take out, is possible based on the value of your property. Loan to Value is the amount of the loan vs. the value of your property and banks express this as a percentage. Typically, you can borrow, or take out, up to 80% of your equity.
- Refinancing to consolidate debt can be a great way to have a single interest rate which is much more manageable than separate terms for auto loans, credit card debts and other lines of credit. That can save you significantly on how much you pay each month toward that debt.
Every situation is different and unique. It can seem overwhelming. It is always a good idea when considering refinancing a mortgage, to speaker to an expert on these matters to help you find the best solution for you and your needs. As a licensed mortgage professional, I can help you determine if a refinancing of your mortgage is the right choice for you and I can help walk you through the process to getting the best rate and mortgage product for you.
This service is FREE and there is no-obligation to you. You can contact me today at email: firstname.lastname@example.org or 416-827-2626 ext. 938.
Lic No. M20001050