Mortgage Refinancing 101

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Jennifer Royea
Refinancing can be a great financial tool and when used carefully

By Jennifer Royea

When it comes to refinancing your home there are many things to consider and you should now what your ultimate goal is and ask yourself what it is you want to accomplish as it will have a big impact on how you will want to proceed.

Refinancing can be a great financial tool and when used carefully, it can reduce your mortgage payments, shorten the term of your mortgage, help you build equity more quickly, or help you in getting your debt under control.

There are many reasons you may decide to refinance:

Interest rates are a great reason to take advantage of refinancing. Penalties may be applied but it’s not something that should stop you. Breaking your mortgage early for a lower interest rate can very often save you money over time. Know the numbers first before you decide.

Access the equity you’ve built in your home to take advantage of an investment opportunity, home renovations, or your children’s education.

Consolidate high interest debt such as a car loan, line of credit, or credit cards.

Add a home equity line of credit. You can have your home and line of credit linked to each other which can provide you with easy access to funds and automatic rebalancing. As your mortgage balance goes down your line of credit increases.

When you decide to refinance your home you are simply paying off the original mortgage and replacing it with a new one. The terms and rates may change (based on your goals and budget) however the property that secures the loan remains the same

Jennifer lives in Pointe Claire with her husband, two children 3 cats and have been in the financial services industry for over 15 years. She can be reached at Jennifer.royea@cibc.com

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