There are numerous reasons why homeowners choose to refinance their mortgages – everything from debt consolidation to freeing up money for their child’s education to using their home equity to buy another property. But the most popular reason for refinancing at this time of year is for holiday gift buying and entertainment.
Planning ahead really can save you money down the road. And with the high-cost holiday gift-buying and entertaining season quickly approaching, this may be the perfect time to refinance your mortgage and free up some mortgage money instead of relying on high-interest unsecured credit such as credit cards and lines of credit.
You may find that taking equity out of your home will help bring joy back into your holiday season – and start the New Year off on a debt-free note, as you may also be able to use some of the equity in your home to pay off high-interest debt such as your credit card and/or line of credit balances. This will enable you to put more money in your bank account each month. And since interest rates continue to hover near historic lows, switching to a lower rate may save you a lot of money – possibly thousands of dollars per year.
There are penalties for paying your mortgage loan out prior to renewal, but these could be offset by the lower rates and extra money you could acquire through a refinance.
I can sit down with you and work through all of the equations to ensure this is the right move for you. With access to more money, you’ll be better able to manage both your holiday spending and existing debt.
Blogged by Elise Hildebrandt, AMP Mortgage Broker Lic #316103 at The Mortgage Centre Brokerage Lic #315847, Saskatoon, SK. Elise has been in the financial industry for 16 years. She has been given the thumbs up by TrustedSaskatoon.com.