Home equity can settle a cash-flow squeeze, or it can simply postpone it. Folding debt into the mortgage brings the payment down. Stretch a three-year balance over twenty-five years, though, and you pay more interest overall.
Add up the full bill
Line up the penalty, the fees and the new term against what you save each month. Divide the penalty by the monthly saving. If that number is higher than the months left on your term, the move costs you.
Look ahead to renewal
A refinance has to leave you with a payment you can carry at the next renewal too. Ask what happens if rates are higher when the new term ends.
Documents to gather
What the lender will ask for.
Mortgage balance today
What the property is worth
Debts or project to finance
Penalty on the current mortgage
The new payment
Equity you can tap
Frequently asked
What documents do I need to pull together?+
Your last two notices of assessment, recent pay stubs, an employment letter, three months of bank statements and proof of your down payment. Add the discharge certificate or proof of settlement. Get these together before you make an offer and a short financing window can work.
Current rates
Today’s rates, with the fine print.
These rates are indicative. Yours depends on your file, the type of mortgage (insured or not) and the lender. And look at the penalty too, it matters as much as the number.
Buying, renewing, refinancing, or something a bit out of the ordinary: tell us where you’re at, even if it’s still fuzzy. Mathieu gets back to you with next steps and the documents to pull together.
