Mortgage refinancing is the replacement of an existing mortgage loan with another under different terms.
A borrower in Ontario may consider refinancing his or her loan for diverse reasons. If you’re not sure whether you should go for a mortgage refinance or not, consider using the services of Ontario mortgage brokers.
The following are some of the different reasons you should consider refinancing.
- To build equity faster
If you are in a position to increase your monthly payments — because of an increase in salary or a fortune — you may want to switch from a 20-year mortgage to a 15-year mortgage.
This switch allows you to build equity on the house quickly. If you consider a bi-weekly refinance option, you’ll quickly build up equity on the house without putting out a large amount of money each month.
- To change the loan type
If you wish to move from an variable to a fixed rate mortgage rate (due to its added stability) and can get best mortgage rates, you should consider refinancing.
- To use the equity you have built up in your home
If you have built up equity in your Ontario house (the difference between the amount owed and the home’s worth), you can use cash-out refinance loan to tap into the equity.
You can use this option to make larger purchases, pay off credit card debts or send a child to college. This refinance option is a perfect way to become debt free.
- To pay off the mortgage sooner
If have landed a bonus at work or inherited money and you wish to pay off your mortgage sooner, you should consider mortgage refinancing offered by Ontario mortgage brokers. With refinancing, you can choose to refinance down from a 30-year loan to a 20-year loan.
When you pay off your mortgage loan earlier, you save a significant amount from interests over the life of the loan. Contact the best mortgage brokers at Oakville Mortgage team for more information on refinancing.