Mortgage Refinancing – Let The Equity In Your Home Work For You
Are you thinking about undertaking that long-planned home renovation, dreaming about that great vacation, or wanting to pay off your credit cards? Maybe you want to start planning for your children’s future education? Mortgage refinancing may be your best option. Working with us will provide you with choice, convenience and great counsel so you can select the best solution for your needs.
Before you begin the process with your current provider, give The Place to Mortgage the chance to go over all of the choices you have available to you to ensure your home mortgage is as optimized and advantageous as possible for your unique situation.
What You Should Know
- In order to consolidate debt into your current mortgage, you must fall within the government approved loan to value guidelines, being up to 80% of the value of the home.
- In other words, debt consolidation, by way of refinancing a mortgage, is only possible if the homeowner has at least 20% equity in the property.
- For example, $400,000 value = $320,000 max mortgage amount, leaving $80,000 equity.
Costs You May Incur
- Appraisal: $300 – $450, dependent on the property.
- Title change/Legal Fees: $600 – $700.
- Penalty with your current mortgage lender: Varies.
- NOTE: Most of these costs can be incorporated into the refinance of your mortgage, meaning you won’t have to pay them out of pocket.
The Steps To Refinancing
Application and Document Collection: We will need to collect your information by having you complete our mortgage application. This can be done online, over the phone, or in person, whichever suits your needs. We will also ask that you supply us with the documents we will need in order to move to the next step.
Analysis: We will use our *super nerdy* system to run all of your numbers, and ask the following questions: Does it make sense for you to refinance? How much money will you save? Is this a long term or short term solution?
Options: We will present you with some options, as well as our recommendations, and help you make an educated decision on which route to take.
Loan approval: If you’re satisfied with the options and recomendations presented, we will move forward with obtaining an approval from a lender.
Appraisal: This step is not always required, and is dependent on property/location/type, etc.
Meet with us: We will go over the particulars of your approval, and collect any final documents we are required to provide to the lender.
The finish line: At this step you will meet with the closing company or lawyer to finalize the refinance, and typically within a couple of days, you will receive the additional equity you accessed.
Reasons To Refinance
- Debt consolidation
- Make an Investment (we can help you with an investment that pays over 6% annual returns)
- Reduce monthly payments, and increase cash flow
- Gain access to funds for education
- Long-awaited bucket list trip
- Rental opportunity or vacation property (down payment)
Mortgage rates are relatively inexpensive compared to borrowing costs elsewhere. Are your debts/investments allocated properly for the most financial gain in the long run?
A Few Things That Don’t Make Sense To Us
- Paying 19% interest (or more!) on a credit card, when you could pay a fraction of that on your mortgage. Mortgage rates are a drastically lower than credit card interest rates and other personal loan interest rates.
- Having a home that is mortgage free, when you could be earning an 8% return on that equity.
“Of course, The ideal scenario is being mortgage free, but we also recognize living life is important too.”