- Access equity for an investment property
If you are contemplating investing in real estate, and want to use the equity that you have created in your home as down payment monies, it is vital that you begin the process in advance of making any formal offers on additional properties.
Some lenders have limitations with clients who own multiple properties. This can create a very stressful situation, especially if you are trying to complete multiple transactions at once. For example, the refinance of your home and the finance of a new home.
it’s all about taking the right steps. Most lenders will allow you to refinance up to 80% of the value of your home. If your plan is to potentially move from your existing property and rent it out, then creating the proper mortgage structure is vital!
- Consolidate other debt
Refinancing your property is a great opportunity to consolidate other high-interest debt such as Credit card debt, lines of credit, personal loans, car loans, etc.
Most unsecured debt is priced at a higher interest rate than your mortgage in order to compensate for the higher risk of default. For many people, it only makes sense to use available home equity to pay out this debt, as it typically reduces interest costs significantly, and can save you thousands of dollars, while minimizing your monthly payments.
- Renovations & home improvements
Have you ever wished you could add that dream kitchen, bathroom, or do some home improvements around your home, but didn’t have the savings to do this?
A refinance of your home could be the right solution to do this! You may be able to access a lot more equity than you realized to make that dream kitchen, or bathroom a reality!