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Life is full of surprises – and often those surprises come with a price tag. There are many reasons homeowners choose to refinance their mortgage to access equity on their home, rather than selling their current home and buying somewhere more else.
Perhaps your family is growing and you’re looking to fund the expenses that come with a new baby or the cost of childcare.
Maybe you’re finally ready for that dream home renovation you’ve been planning for years.
Or it could be that you’re simply looking to ease expenses or improve living conditions by taking advantage of changes in the market.
Here are three reasons you may choose mortgage refinancing rather than selling your home…
1. Refinancing allows you to pull equity from your home for other expenses.
Let’s say you purchased a property three years ago for $500,000. Since that time, you’ve noticed the market has been growing steadily, and just last week your neighbour sold for $700,000.
This may be a good time to tap into the appreciation built up. You can do this by refinancing to 80% loan to value, which puts an extra $160,000 in your pocket that you can put towards a renovation, home expenses, or even investing in another property.
2. Refinancing allows you to take advantage of lower interest rates.
Interest rates are still at a low, making this an enticing time for homeowners facing financial stress to make a move. Refinancing allows you to lower your interest rates and lower your payments. It also gives you the opportunity to consolidate high interest non-mortgage debt in a new mortgage, resulting in one easy, monthly payment and saving you thousands of dollars in interest over time.
3. Refinancing offers more financial gain with less hassle.
Perhaps your lifestyle has recently changed – maybe you’ve added to the family, or your spouse just took on a new job with a longer commute. If you’re thinking about moving to a larger home, or to a neighbourhood closer to work, it’s important to first weigh your options.
Taking on a bigger mortgage for a bigger home or a more expensive location may not be the answer. Perhaps tapping into the equity on your current home to fund a renovation or a vehicle for that commute makes more financial stress. Keep in mind, there are costs associated with refinancing a mortgage, but moving also comes with additional closing costs and other expenses that should be considered in your plan.
Have questions about refinancing your mortgage? We’d be happy to discuss your options with you. Get started today by filling out our quick and easy online mortgage application, or connect with us and we can walk you through it.
If you have a comment about this blog post, have questions about the different mortgage types we provide or wish to ask any other questions about how to get a mortgage from CVE Mortgage Group, please feel free to contact us