Refinance Mortgage Guide
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Refinancing your mortgage allows you to borrow against the equity in your home for purposes such as renovations, investments, debt consolidation, and more. You are allowed to refinance at any point during your term, although there are different costs associated with it at different times.
We encourage you to contact us at any point for advice or information on refinancing your mortgage.
Before You Get Started
It’s important to have a clear picture of how much money you require before you begin the refinancing process. Depending on the purpose of the additional funds, you may require a little or a lot, so having a professional and accurate estimate on potential renovations or investments can be very helpful.
When applying to refinance, you’ll require an appraisal on your home. Banks will lend you a maximum of 80% of the appraised value, so when you subtract the amount owing on your mortgage from that 80%, you can roughly determine how much you are eligible to receive.
The application process is the same as when you initially secured your mortgage. Lenders will consider your income, debts, and credit rating in conjunction with the property value when determining how much money they’re willing to give you.
If you refinance mid-term you may be faced with a discharge penalty, which is not the case once your mortgage has matured.
In the case of a mid-term application – and depending on the type of mortgage and rate – you’ll need to decide between blending your current rate, adding a mortgage component, or taking on a whole new mortgage. Factors such as potential discharge penalties, your remaining term and prevailing market rates will all affect your decision. It’s a straightforward financial calculation that we are happy to help you with.