There are several reasons for wanting to refinance your home. Perhaps you’re looking to pay off your credit card debt, update your kitchen, or reduce your mortgage payments. Refinancing can make good financial sense; but there are things you should be aware of before you jump in to the first offer available to you. Mortgage refinancing should be researched thoroughly. Here’s how you can avoid the biggest mistakes when considering mortgage refinancing:

1. Don’t go to your bank first:

Many people do this because they think they will get a better deal as an existing customer. Actually, the opposite is true. They already have your loan, so why would they give you special treatment? If you do end up going to your present bank at some point, don’t tell them you’re shopping around; instead, tell them that you’re considering paying off your mortgage early.

2. Know what the interest rates are:

In the case of mortgage refinancing, knowledge really is power. Do your research and know what the current interest rates are. It’s also crucial to know what you’re paying now and what the terms of your mortgage are.

3. Know what your costs will be:

There will be a penalty for moving your mortgage and it could be three months’ worth of interest or more. Make sure you understand and account for this and any other related costs when mortgage refinancing.

4. Make sure you’re comparing apples to apples:

A quote for a 5-year fixed mortgage at one lender is very different than a 10-year fixed mortgage at another. Be careful that you’re comparing similar products.

5. Be careful to not overvalue your home:

Your home is your castle it’s true but try to be objective when evaluating its worth. A coat of paint in the kitchen will brighten things up but won’t add $10,000 to the value. It’s best to call a realtor, or research what similar homes sell for in your neighbourhood.

If you’re ready for a mortgage refinancing solution, contact Jamie Arthurs  today!