Back in the day, the mortgage that allowed you to purchase your home was a great deal. While you still think it’s a good one, is it really the best you can do? One way to find out is to compare options available today with what you have in place. Here are four reasons that provide the motivation to make a change.
Your Credit Score is Better
A lot has happened since you secured your first mortgage. Along with paying off some unsecured debts and paying the mortgage on time, you are earning more money. Those factors combined have helped your credit score quite a bit. The change in your credit rating could translate into rolling your old mortgage into a new one with a lower interest rating. Even if you choose to go with a loan that retains all of the other features of that previous mortgage, the lower interest rate will impact the amount you pay over the life of the loan.
Interest Rates are Down
How do the average mortgage interest rates of today compare to what you were able to lock in when you purchased your home? If today’s rates are significantly lower, it could be worth the cost associated with refinancing your loan with a different lender. You will find that Canada WF private home loans are competitive and will likely provide a lower interest rate even if there has not been much of a change in your credit rating.
You’d Rather Have a Fixed Instead of a Floating Interest Rate
You opted for a fixed or variable interest rate on your original loan since it was unclear whether the rates would go up or down. Now that you are nearing the end of the up-front period and the guaranteed fixed rate, it’s important to look at what your floating rate will become. If it’s more than you expected, now is a good time to consider replacing the old loan with one that has a fixed rate for the remainder of the term. Doing so ensures you are protected no matter how much the average rate increases.
You Could Refinance to a Shorter Term
Thanks to an improved financial outlook, you are in a position to retire your mortgage sooner rather than later. Doubling up on the payments for your current mortgage is one way to go. Another is to refinance the debt and lock in a lower interest rate. Assuming you can still handle the payments and shorten the term by ten years, you’ll end up saving quite a bit of money.
Even if you are content with your current setup, it never hurts to see what sorts of refinance options for Hamilton mortgages are available right now. Consider the impact on the total amount you will repay plus the change in the monthly mortgage payment. You may find that making a change will help you on more than one front.