If you are looking to refinance your current mortgage you will probably
be doing so for one of three reasons; to consolidate debts, to reduce your
interest rate or to get equity out of your home. We will deal with each of
these issues separately. The underlying message is to seek out professional
advice because your situation is unique and it needs a unique solution!
your mortgage to pay off other debts can save you money. If you are
perpetually carrying large credit card balances, or have other high
interest rate loans, it may make sense to consolidate these debts into your
mortgage. Not only will you reduce the interest rates you are paying but
you will also improve your monthly cash flow.
refinance these debts several ways. You could consolidate all your debts
into one big mortgage, just add a small second mortgage or even a secured
line of credit. The route you take will depend on your particular
Your Current Interest Rate
If you are
locked into a high rate mortgage you may want to break your current
mortgage contract and renegotiate a new mortgage with a lower rate. The
first thing that you should realize is that unless your mortgage contract
specifically allows for this, your current lender is under no obligation to
allow you to renegotiate your mortgage rate. Having said this, most lenders
will allow you to prepay your mortgage. You should begin by finding out
what your lender will charge you to renegotiate your mortgage rate. Once
you determine the penalty, then you can begin to calculate the potential
benefits of a lower interest rate. Alternativly we can renegotiate for you.
choose to refinance their mortgage to finance a new addition, for an
investment opportunity, to help their kids buy a home, to finance a new
business etc. Each situation is unique and as such advice on how to
structure such a transaction is unique to the individual.
comes to refinancing there can be many ways to structure the same
transaction and you need to know all your options before you can make an
When you are
ready to make an informed choice just let us know.