Benefits of Refinancing Your Mortgage

There are many instances where borrowers required additional funds from their equity to renovate the house, basement, Tuition fee for children, for investments or sometimes for better interest rate. If the rates have dropped recently and your mortgage refinancing is coming up for renewal. You can switch it to a different lender and can have access to your home equity loan.

Refinancing an existing mortgage means replacing it with a different lender and at different terms. You can also increase your mortgage amount and amortization, a maximum of 30 Yrs.

The maximum Loan to value we can get is 80%. The lender will calculate the loan to value ratio by dividing the mortgage balance and any other debts secured at the property, which should not be more than 80% of the appraised value. If it is less than 80%, you can refinance it. You can also consolidate your secured line of credit and credit cards as well into the mortgage. It will increase your monthly cash flow. Refinance will help to consolidate all your debts into one mortgage payment with low-interest rate.

We also help those clients who have taken the 2nd mortgage on their property in Mississauga and Brampton because refinancing was not an option due to high penalties with the existing lender or loss of job.

But now the term is about to over and wants to consolidate your 2nd mortgage into an existing mortgage with the bank. Most of the 2nd mortgages are interest-only payments and the rate of interest is high. With consolidating we can add the 2nd mortgage amount with all the fees and expenses to your existing mortgage and we can refinance the mortgage with the bank and reduce the monthly mortgage payment.

What is a high ratio mortgage?

A mortgage for more than 80% of the market value or purchase price is considered a High Ratio Mortgage. It can go up to 95% LTV with a 5% minimum down payment from Borrower’s own resources. High Ratio mortgages are always insured with Genworth, Canada guaranty or CMHC. The insurance company ensures the lender in case you default your mortgage payment. You must pay for this insurance premium, which will be added to your mortgage amount. Maximum Amortization is 25 years.

What is a conventional mortgage?

A mortgage for less than 80% of the market value or the purchase price is considered a Conventional mortgage. This loan is not insured by any insurance company. The minimum down payment required is 20%. And can go up to 30 years of Amortization. In this mortgage, equity builds pretty much faster because of more down payments.

What is an open mortgage?

An open mortgage gives you the flexibility of making extra payments toward your mortgage amount. It goes directly to the principal amount. It also let you pay off the mortgage anytime and faster than the closed term. There will not be any penalty for breaking the term.

What is a closed mortgage?

A closed mortgage means that the mortgage term is closed for a decided term. If it is 5 years fixed mortgage. You cannot break the mortgage without paying a penalty which is an interest rate differential or three months interest whichever is higher. You can prepay a certain amount every year and you can also increase your monthly payment by a certain percentage. If you prepay the whole amount before the end of the term, you will have to pay the penalty.

COVID-19 Update:  We're here for you. These are uncertain times but one thing that is certain is our commitment to you. As an online business, we're set up to help you remotely so you can still take care of your mortgage decisions.