Consolidating your debt can be made easier by refinancing your home mortgage

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Canadian homeowners must refinance every five years by law. However, there is no limit to the number of times you may refinance. There are also many reasons to avoid the five-year deadline. Many homeowners opt to refinance as soon as rates fall. Interest rates falling can help you save money and get lower payments.

Refinancing your home doesn’t mean getting a lower interest rate. Online payday loan consolidation companies as consolidationnow has a great way for you to improve your financial situation. 

Before we can tell you how refinancing consolidates your debt, it is important that we explain exactly how refinancing works.

What is refinancing, you ask?

Sometimes the word “refinance” can seem a little misleading. The “re-” indicates that you are renegotiating or reducing your home’s mortgage. Refinancing simply means taking out a loan to replace an older one.

Although it is quite common for homeowners who refinance their mortgages with a lender they worked with to get the original mortgage, you do not need to sign a new mortgage agreement. The same supplier.

A mortgage broker can help you refinance your existing mortgage to get a better rate. They will also give you the ability to extend the repayment term or make some money from your home equity. This is an excellent option for homeowners trying to consolidate debt.

Refinancing can be used as a tool for consolidating debts

Canada has a significant problem with debt. Unsecured consumer debt is the worst. For the interest on existing debts they owe, many households pay huge amounts of money. Refinancing is taking out a new loan. This can be used to make extra money to cover high-interest unsecured debt.

Because refinancing allows for you to tap into the equity in your house. If you have been paying your mortgage over many years, you may now be able to sell some of the equity in your home. You may be responsible for:

  • Credit card debt
  • Automated payments
  • Payday loans
  • Student loans

Although this will prolong the time required to pay off your mortgage it will also lower the cost of any remaining loans. This will allow you to rebuild your credit and chart a path to debt-free living.

After more than a decade of pandemic containment the economy is opening up again and interest rates are starting to climb. You still have time to take advantage this golden opportunity to refinance mortgages.

A mortgage broker can help you to explore your options for refinancing your mortgage if you wish to overcome the pandemic and return to financial strength.

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