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What is Refinancing and how can it help?



Jason Gangnier

The real estate market has risen at a dramatic rate, especially in the past 5 years. Many homeowners that have owned a home or rental property have seen their equity grow fast. With this rise in home prices the mortgage industry has seen millions take advantage of the rising equity and have refinanced their mortgage.


When clients come to me to refinance it can be for many reasons that benefit their financial situation. The reality is that not everyone knows the true benefits and reasons to refinance. I will go over some of the top reasons why so many Ontario home owners are finding their financial situation will improve with refinancing.


What is refinancing?

Refinancing is when an existing mortgage is closed and a new one is opened. Say Jane and John own a house that is valued at $800,000 with a mortgage of $200,000 remanding. They close the $200,000 mortgage and open a new mortgage that is up to 80% of the appraised value which would be $640,000 (Note, up to 80% of the value is the max, you can do any amount. Now the options of what they can do are endless, they can buy a rental property, pay off debts, do a renovation, invest a portion, purchase items or even pay for their children's education. The possibilities are endless.


Buying a rental property

Over the past 5 years many Ontario home owners have seen their homes almost double in price. Owning a house is an excellent investment, it will grow with inflation and can turn a profit when rented out. Clients of mine find that increasing their mortgage to coverage a downpayment far out weighs the long time it takes to save for a downpayment. In turn you can buy a rental property, have that mortgage covered by the renter and find that in 5 years that property has grown in value. Buying real estate has created a massive wealth for millions of people.


Pay of debt

Life is expensive and comes at a cost with interest to pay down your debt. I have many clients that come to me with large car loans, credit card balances, line of credits, student loans, etc. When you're paying 5%+ interest a month it gets hard and costs a lot to pay off the debt.

Refinancing helps pay off the debts and bundles them into your new mortgage with a lower interest rate saving you thousands every year and should i mention lowering stress of having so many different payments that seem to be running away.


Renovations and investing

Who doesn't want a new kitchen, bathroom or addition to the house. Over the past year thousands in Ontario have renovated their house since spending most of their time at home; I even did! Making your vision of the perfect kitchen or bathroom is expensive but refinancing makes it so easy. I can get you a great interest rate and possibly lower your payments while putting money into your renovation and possibly putting a little aside into your future with investments.


I'm happy to answer any questions you have with refinancing your current mortgage and turning the next chapter forward. Contact me at 905-512-2514 or jasong@mi35.ca



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