Posted: 16 Dec '19

Key Reasons to Consider Refinancing Your Mortgage

Refinancing your mortgage means paying off your existing loan and replacing with a new one. There are several reasons why you can decide to refinance your loan. You can obtain lower interest rates, access the equity in your home, consolidate debt, or change your terms.

Why Should You Choose Mortgage Refinancing?

1. To Obtain a Lower Interest Rate

One of the benefits of mortgage refinancing is access to lower interest rates. As you continue to work and pay your bills on time, you improve your credit score. A higher credit score gives you access to lower interest rates, which helps you reduce your monthly payments. It is advisable to refinance your mortgage if you can reduce your interest rate significantly. A lower interest rate will help you save money and increase the pace at which you grow the equity in your home. A mortgage broker will help you determine if it is a suitable option.

2. To Change your Mortgage Terms

Mortgage refinancing is an option to renegotiate your mortgage terms. For example, changing from a fixed rate to a variable rate, or changing your amortization can reduce payments and help you achieve your financial goals faster.

3. To Access the Equity in Your Home

Many homeowners in Edmonton choose mortgage refinancing to access equity in their homes. In this case, you can refinance if you want to pay off debt, cover your child’s education costs or remodel your home and more.

4. To Consolidate Debt

If you have enough equity in your home, you can consolidate your debt through a variety of refinancing methods. The debts may include car loans, credit lines, or credit card debts. Debt consolidation helps you replace high-interest debt with a lower interest mortgage. One monthly payment is more manageable than many.

Cost of Mortgage Refinancing

There are costs associated with refinancing your mortgage. They can include, penalties, legal fees, appraisals, etc. Talk to your broker about these costs.

Mortgage Refinancing in Edmonton

Refinancing can be beneficial. However, it is not for everybody. Dominion Mortgage Brokers can help you find the best mortgage refinancing options in Edmonton. Contact a mortgage broker today.

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