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Reasons to Consider Refinancing a Mortgage
Maybe you need more funds to wipe clean some debt or some extra cash for the new kitchen, or if your mortgage is simply up for renewal, CVE Mortgage will make sure you get the best mortgage product for your given mortgage needs.
There are many reasons that you may have in considering a refinance of your mortgage before your renewal date. Common reasons you may want to refinance prior to renewal might include:
- A desire for lower interest rates
- A desire for lower payments
- To obtain funds for renovations
- As a way to consolidate debt
- To pay for or prepare for emergency situations
How does the Refinance Process Work?
There are several steps in the mortgage refinance process, but if you’re organized and thoroughly prepared and have a mortgage broker you’re dealing with, it can go quickly. Typically, the process can take anywhere from two to four weeks, but could be longer, if documents are not in place or the appraisal is not completed on time.
The first step is to obtain the services of a mortgage broker. CVE Mortgage Group, Inc. can assist you in this process and ensure that the process goes as quickly as is feasible.
Once you’ve obtained the services of a broker who can provide solid advice and help you find a lender that you are comfortable with and suits your unique needs, the next step is document submission. You’ll need to file a variety of documents – a loan application, information on your existing mortgage, identity and income verification. Once the lender for the refinance has those documents, they will execute a title search to ensure that there are no liens on the property. They will also ask for your credit report.
The third step is to have your property appraised. An appraisal is a piece of the puzzle that can really hold up the process. Lenders need to know exactly what your property is worth, in order to accurately assess the property’s mortgage value.
The final steps in the mortgage refinance process include the underwriter’s review of your financial situation (income, debts and accrued home equity) and compare those figures with the amount you’ve requested in your mortgage loan application and the lender’s closure of the loan. It is the underwriter’s job to evaluate all of the financial documentation to determine the level of risk associated with extending a mortgage loan to you. A high credit score can help to ensure that the underwriting process moves more quickly.
When the underwriting process and previous steps are complete, the lender will issue a mortgage package. Otherwise, the lender will close the loan and the funds will be issued to pre-pay the existing mortgage.
As a homeowner who is interested in refinancing a mortgage, it is important to understand all of the options that are available to you as you make the decision to refinance. You can break your existing mortgage contract, and this is a popular option for those who want to get a lower interest rate or tap into the equity that they have developed in the home during their ownership, but there are other options as well.
Those options include adding a home equity line of credit or sticking with your current mortgage lender and doing something known as “blending and extending” an existing mortgage.
A home equity line of credit has its benefits. For example, you’d be responsible only for the interest on the amount of money you’ve accessed, and you could get a home equity line of credit through your current bank.
It may be worth a discussion with your current lender, to see if they will consider blending and extending your current mortgage. When this happens, according to Ratehub.ca, your lender may give you a “blend” of the current mortgage rate and additional money you borrow, at the current market rate. It is important to understand though, that with this option, a blended rate is likely to be higher than the current market rate. Make sure you’ve done the math- are the savings significant enough to balance out the higher rate?
Costs Associated with Refinancing a Mortgage
There are costs associated with the act of refinancing a mortgage, but these typically depend on a number of factors, including the amount of money you owe on your current mortgage and the strategy you choose for the refinancing.
Determining whether or not it makes financial sense to refinance early is a complex set of calculations that includes all of your debt, your current mortgage and numerous personal items such as income and long term goals. Allow me to make this process simple, and handle all the complex calculations to determine if a mortgage refinance is right for you. Contact CVE Mortgage Group Inc. today by calling 519-501-7758, 888-593-9280, completing this mortgage application form or, by using the contact form noted below.
Many of us have been in a position where refinancing your mortgage has become something on our to-do list but it has been pushed off until you can ignore it no further. CVE Mortgage will walk you through the entire process and ensure that you and your family are shown the best mortgage options for your specific situation. If you have any questions at all pertaining to how to proper refinance your mortgage, allow us to ease your concerns. Complete our contact form below and CVE Mortgage will be in contact shortly.