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5 BAD REASONS TO REFINANCE YOUR MORTGAGE IN OTTAWA

5 BAD REASONS TO REFINANCE YOUR MORTGAGE IN OTTAWA

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5 BAD REASONS TO REFINANCE YOUR MORTGAGE IN OTTAWA

Mortgage refinancing in Ottawa seems like a great way to save money to most people. When the rates fall in the market, mortgage refinancing is the trend to catch up with in Ottawa! But a lot of people use the option in ways which can only affect them adversely. It is important to decide when mortgage refinancing in Ottawa could actually be a bad idea for you. We have to consider all our options and the total amount we would be spending and saving before we choose to refinance our mortgage plan.

5 BAD REASONS TO REFINANCE YOUR MORTGAGE IN OTTAWA

Here are the top 5 worst reasons to do mortgage refinancing in Ottawa:

To invest:

  • Money flows out of our hands when we have it. Most of us do not have control over what we are spending on. Having an option from which we can get the funds we need whenever we need them, makes us irresponsible. Unless it is absolutely necessary, we should try not to spend money which we don’t have with mortgage refinancing in Ottawa. Money management is very important and increasing our debt is not going to help us save anything.

Longer term:

  • In Ottawa, mortgage refinancing done to get lower rates with a longer term is useless unless you start saving less time, mortgage refinancing in Ottawa in a longer time frame can actually harm you. Most of us just look at the rates and assume that if it is lower than the one we are paying, we tend to go for it! But if you are not getting any benefits such more mortgage time, then this is a bad financial decision!

To save up for a second home:

  • If you are planning to take up a new home and want to save for your down payment with the help of mortgage refinancing in Ottawa, it would be wise to look at all your options before doing so. This will not only extend the term of this loan, but also affect your credit score. You should make sure it goes with your financial goals.

Taking more cash out:

  • This is probably one of the worst reasons to refinance. It just keeps putting you back to square one and will not bring you any closer to the day when you would be debt free. This could harm you more than it can help you. It is a vicious cycle and people keep on borrowing with mortgage refinancing in Ottawa and end up in debt they can’t pay off. This could cause your financial situation to worsen and you could become bankrupt!

To switch your type of rate:

  • If you are considering mortgage refinancing in Ottawa for the sake of changing your rate type, then it is very important to consider how much you would be paying. The main aim of mortgage refinancing in Ottawa is to save money. If your new plan doesn’t help you to do that, then it’s a bad reason to change your current plan!

To know more about Mortgage refinancing you can contact our team : Platinum mortgage Ottawa

How Mortgage Refinancing In Ottawa Can Bring You A Sigh Of Relief

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Mortgage refinancing is a way to finance your existing mortgage payment and create a new mortgage loan in place of the old one, in Ottawa. In this, you are most likely to get a full value of your primary mortgage loan. A new contract takes place in a mortgage refinancing transaction while the original mortgage loan is cleared off. You can avail a mortgage refinancing loan in Ottawa either from your existing lender or any other who agrees so. There can come a time when you default on your mortgage payments on your primary mortgage- at such times mortgage refinancing could be your best way out.mortgage refinancing

You can also reign in your home equity while opting for mortgage refinancing. Through which, you can avail a mortgage of higher value if the market price of your house in Ottawa has gone up since the initiation of your original mortgage. Mortgage refinancing can prove to be a boon when in the times of market boom and lowered interest rates, or when you are in need of finance and are not able to avail a home equity loan.

Below Are The Reasons When And Why You Should Consider Mortgage Refinancing In Ottawa

-If You Can Get Better Rates

If the rates in Ottawa have gone down significantly, say more than 1% or 2 %, it is the time you should be considering mortgage refinancing. All it takes is to find a broker, to spend time with him and to pay him for the incremental benefit you will be getting from the interest rate differences in your original and the refinanced mortgage loan.

-If You Are In A Position To Pay Off Your Loan Faster

If your financial position has developed and you are in prosperity, then you may want to not bear the large interest costs included in your house mortgage payments. So in order to pay back quickly, you can opt for a mortgage refinance and avail a mortgage with lower payback period, and also if possible, at better rates.

-Have Access To Your Home Equity

You can choose between mortgage refinancing and second mortgage in order to avail higher credit when you are in need of finance and your property’s valuation has gone up. Although you have a limitation of up to 80% of your home value that can be availed as mortgage loan in Ottawa.

-Improved Credit Score

If your credit score has improved amidst your mortgage repayment tenure, then you should be able to reduce your interest rate of the mortgage and also increase your borrowing power.It is through Mortgage refinancing that you can easily avail these benefits of an improved credit score.