It’s not that you’re unhappy with the current mortgage. In fact, it’s easy for you to make the installment payments and they always post quickly. Even so, you wonder if refinancing would be a good idea. Since it never hurts to look, contact one of the certified Toronto mortgage brokers and agents and get an idea of what sort of deal you could get. While you do that, take a good look at your motivation for refinancing. Ask yourself the following four questions. The answers will help you decide if proceeding is the best move right now.
How’s Your Credit Score Doing?
When you were approved for your first mortgage, those credit scores were good, but they weren’t anything fantastic. Things have changed a bit in recent years. Along with carrying less unsecured debt, higher wages or salary, and a record of paying bills on time, your scores are considerably higher.
What does that mean in terms of seeking refinancing? It does increase the number of lenders who might be willing to work with you. They also mean that the odds of receiving better terms and conditions than you have now are quite good. Now could be the ideal time to leverage your improved circumstances and lock in a better mortgage.
Other Than Seeking a Lower Interest Rate, Is There Another Reason to Refinance?
Wanting a lower interest rate on the mortgage is reason enough to seek refinancing. There can also be other perks that you should consider. For example, did you know that the refinancing could come with a shorter term as well as lower interest rates? That would mean the property would be paid off sooner rather than later.
Examine your reasons for considering the idea of refinancing. Make a list and take a good look. You may find that there are more benefits to doing this than you initially thought.
How Much Do You Stand to Save by Refinancing?
If it looks like you will save money by refinancing, how much will stay in your pocket? This isn’t as clear-cut as you may think. That’s because there are likely to be some fees and charges associated with the refinanced mortgage. Depending on the amount those charges come to, there may not be a lot of savings left.
As you look at any deal you’re offered, take the time to project how much it will cost in the long run. Compare that to what it would cost to keep your current mortgage intact. If the figure isn’t all that impressive, it may not be worth the time or effort to refinance.
Overall, Do You Consider the Effort Worth It?
When you get down to it, no one can really say if refinancing is worth it but yourself. While much of the focus is on the financial benefits, there are other points to consider. Even something as simple as being more comfortable with the lender can make refinancing worth the time and effort. For that reason, only proceed if you’re sure that you’ll be happy with the new arrangement.
Homeowners who prefer to refinance their mortgages often find that working with agents makes it easier to find the best deal. Take your time, look closely at the recommendations, and then make a decision. In the long run, you’ll be glad that you did.