Mortgage Refinancing in Ontario
Could Your Current Mortgage Be Working Harder for You?
Your mortgage doesn’t have to stay exactly as it was when you first bought your home.
As your life changes, your mortgage needs may change too. You may want to consolidate higher-interest debt, access equity for renovations or another major expense, change your mortgage structure, or simply find out whether there is a better option available.
Refinancing your mortgage lets you replace or restructure your existing mortgage with new financing based on your current needs, financial situation and available home equity.
The important question isn’t simply“Can I refinance?”
It’s“Does refinancing make financial sense for me?”
That’s what I can help you figure out.
What Is Mortgage Refinancing?
Refinancing means making a significant change to your existing mortgage, often by replacing it with a new mortgage.
Depending on your situation, refinancing may allow you to:
- Access some of the equity you’ve built in your home
- Consolidate higher-interest debts
- Finance renovations or major expenses
- Change your mortgage amount or amortization
- Restructure your mortgage to better fit your budget
- Move to a different lender or mortgage product
The right strategy depends on your existing mortgage, the equity available in your home, your financial situation and what you’re hoping to accomplish.
Why Do Homeowners Refinance?
There isn’t one single reason to refinance. For many homeowners, it’s about reorganizing their finances rather than simply finding a different interest rate.
Consolidate Higher-Interest Debt
If you’re carrying balances on credit cards, personal loans or other higher-interest debts, refinancing may allow you to consolidate some of those debts into your mortgage.
This may reduce the interest rate on the debt and make monthly payments easier to manage. However, moving debt into your mortgage can also mean repaying it over a longer period.
That’s why I look at the long-term cost, not just whether the monthly payment goes down.
Access Equity in Your Home
If you’ve owned your home for a while, you may have built equity through mortgage payments and changes in your property’s value.
Refinancing can potentially give you access to some of that equity for things like:
- Home renovations
- Major repairs
- Education expenses
- Investment or business opportunities
- Other significant financial needs
But refinancing isn’t your only option for accessing equity. Depending on your existing mortgage and what you need the money for, a second mortgage may also be worth considering.
Adjust Your Mortgage
Sometimes the reason for refinancing is the mortgage itself.
Your financial situation today may be very different from when you originally arranged your mortgage. Refinancing provides an opportunity to look at the bigger picture and potentially adjust your mortgage amount, amortization, payment structure or product.
For some homeowners, reducing the monthly payment is the priority. For others, paying the mortgage down more quickly matters more.
There is no one-size-fits-all solution.
And if your mortgage is approaching its maturity date, refinancing may not be necessary at all. Your upcoming mortgage renewal may provide an opportunity to explore different options without breaking your mortgage early.
Thinking About Refinancing?
Use the Mortgage Payment Calculator to compare different mortgage amounts, amortizations, and payment frequencies.
How Does Refinancing Work?
Before recommending a refinance, I start by looking at where you are today.
1. Review Your Existing Mortgage
We’ll look at your:
- Current mortgage balance
- Interest rate and remaining term
- Remaining amortization
- Payment
- Prepayment privileges
- Potential penalty for breaking the mortgage early
These details matter because refinancing before the end of your current term can come with costs.
2. Look at Your Home Equity
Next, we’ll look at the approximate value of your home and compare it with your existing mortgage and any other financing secured against the property.
This gives us a clearer idea of how much equity may be available and what options could be possible.
3. Review Your Financial Picture
Your income, debts, credit history and the property itself can all affect the financing options available to you.
If you’re self-employed, qualifying can sometimes look a little different, particularly when your taxable income doesn’t tell the whole story of your business finances.
4. Compare the Numbers
This is where the decision becomes much clearer.
We can compare your existing mortgage with the proposed refinance and look at:
- Your new mortgage amount
- Interest rate
- Monthly payment
- Amortization
- Mortgage penalty
- Appraisal, legal or other applicable costs
- The longer-term cost of the new financing
The goal is to understand the complete financial picture, not just whether the new monthly payment is lower.
What Does It Cost to Refinance a Mortgage?
This is an important part of the conversation.
Depending on your existing mortgage and the new financing, costs could include:
- A mortgage prepayment penalty
- Appraisal fees
- Legal fees
- Title-related costs
- Lender or administrative fees, where applicable
Not every refinance will have every one of these costs.
That’s why I prefer to calculate the actual costs for your situation rather than rely on a generic estimate.
A lower interest rate or payment doesn’t automatically mean refinancing will save you money. The potential benefit needs to be weighed against the cost of making the change.
Should You Refinance Now or Wait Until Renewal?
Sometimes refinancing before renewal makes sense.
Sometimes waiting is the better decision.
If breaking your current mortgage will result in a significant penalty, we can compare that cost against the potential benefits of refinancing now.
If your renewal is approaching, it may make more sense to explore your options as part of your mortgage renewal.
And sometimes, after reviewing everything, the best advice is simply to leave your mortgage alone for now.
That’s an answer too.
Refinancing vs. Other Ways to Access Equity
Refinancing isn’t the only way to use the equity in your home.
Depending on your situation, another financing solution may make more sense.
Second Mortgage
A second mortgage allows you to borrow against your home while leaving your existing first mortgage in place. This can sometimes be worth exploring when breaking an existing mortgage would be particularly costly.
Private Mortgage
If your situation doesn’t meet traditional lender guidelines, a private mortgage may be an option in certain circumstances. Your site also has a dedicated private mortgage guide.
Reverse Mortgage
For homeowners in the appropriate age group who are looking to access their home equity, a reverse mortgage may provide another alternative.
The right solution depends on what you need the funds for, how much equity you have, the terms of your existing mortgage and your longer-term plans.
Is Refinancing Right for You?
Refinancing may be worth exploring if:
✓ You have built equity in your home
✓ You are carrying higher-interest debt
✓ You need funds for renovations or another significant expense
✓ Your current mortgage no longer fits your financial situation
✓ You want to restructure your mortgage or payments
✓ Your mortgage renewal is approaching and you want to explore your options
✓ You simply want to know whether there is a better way to organize your borrowing
You don’t need to know which mortgage product you need before reaching out.
That’s my job.
Let’s Run the Numbers
Refinancing can be a useful financial tool, but the right refinance is about more than getting a new mortgage.
I’ll look at your current mortgage, available equity, debts, goals and the costs involved so you can understand what refinancing would actually look like before making a decision.
Sometimes refinancing makes sense.
Sometimes debt consolidation, a second mortgage, or simply waiting until your mortgage renewal makes more sense. These are all existing topic/service pages on your site.
And sometimes the best decision is to keep exactly what you have.
Let’s figure out which one applies to you.
Wondering if refinancing makes sense?
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