Best reason why you should refinance your mortgage.
With interest rates being this low, it is an opportunity to pay down your mortgage, unsecured debt, take out some equity and invest, or help children and family. Why wouldn’t you when the rates are as low as 1.9% variable rate or as low as 2.49% fixed rate in Mississauga/Toronto GTA region at the time of this writing. Lets look at the 5, and not the only reasons why.
How to Refinance to pay off some debt and stop drowning.
***This works ONLY if your credit score has not been ruined below repair because you let the debt accumulate to the point that you missed your minimum payments many times (in this case call us today ASAP so we can hep you fix this problem and get you back on the right track)
Probably the most common reason of refining in our market is to pay off some high interest debt. Lets say that you have 2 or 3 hundred thousand in equity of your home and are drowning in over a hundred thousand in debt on your credit cards which are charging you from 6% (if you are lucky) to as much as 25% and up. It makes a wise decision to pay that off immediately. If you don’t pay it off, the minimum payment will soon escalate because once you go OVER the limit, you will need to pay the full balance over the limit, PLUS the minimum payment. That could mean that, on a bad month, you may have to pay a few hundreds or even a few THOUSANDS more than you normally do very month. This could very quickly bankrupt you by putting you in a situation where you simply can not come up with this money to pay it. This is the down fall of Credit Cards.
So how does refinancing help.
By taking the 100,000 out of your equity in your home, you can now pay off the full balance on your unsecured debt such as credit cards and maybe even some secured debt like your car loan. You will now be paying that debt off with an interest rate of only 2-2.5% and a FINITE amount of payments, at the end of which your debt is paid off, where as with the credit card debt, it is (almost) forever if you only make minimum payments.
What to do to get out of the situation that got you in Debt in the first place?
Next wise thing to do would be to change your habits or the situation which got you in this much debt so that it does not continue to be a problem and bring you back int debt troubles again. If it is lack of income that got you in this mess, try looking for alternative income, such as a part time job, freelancing on the internet (almost ANYONE can do this through Fiverr or Upwork etc), or start applying for higher aid jobs, or start your own business on the side to bring some extra income (internet can help you start a small business with NO money, just go on Google or Youtube and read, watch and learn from others who have done it) If you find that you are still stuck and debt is piling on again and you can not do any of the above, we are here to help. Call or email us immediately.
If it is out of control spending, call us for free counselling session on spending habits, budgeting and how to control impulse spending,
We will be happy to help you! Tomorrow will come anyway, so call Susie today, and tomorrow could be better already!