Living paycheck to paycheck? You’re not alone.  

 

Canadians are carrying heavier loads of personal debt than ever before. For some of us, the cost of servicing those debts is in itself an obstacle to correcting the problem. Each month can be a chase to make the interest payments to keep the debt afloat.  Sometimes, it may help to consolidate debt into your mortgage.

 

The difference between credit card debt or unsecured debt, versus a mortgage, can mean thousands of dollars. As you may know, the interest you pay on a credit card or unsecured credit line is typically much higher than on your mortgage. Because of this, using your home equity to pay off your high-interest credit card debt can save you money in the long run.

 

That said, deciding whether it makes sense to refinance your mortgage will depend on your individual situation. Either way, with the right plan in place, you can be well on your way to a strong new financial life. If a consolidation is a way you decide to go, every month you could be seeing the difference: a boost to your monthly cash flow, one easy payment, faster debt paydown, and potentially thousands of dollars in interest savings.

 

We can show you how to use your home equity to consolidate your high-interest debt into a new or existing mortgage.  It often makes sense to roll large amounts of high-interest debt into a mortgage. Why? Because we are benefiting from low mortgage rates, while credit card rates can be 5 times as high.  Just compare mortgage rates with what you’re paying on your credit cards and other debts.

 

We start by doing an assessment of your situation.  We list your current debts – both the total amounts owed and the monthly payments you have to make.  We then create a scenario that takes into account your potential new mortgage, with the applicable monthly payment.   We also look at your home’s current market value, to make sure that a new mortgage can be registered against it.  With a mainstream lender, your new mortgage amount needs to be less than 80% of the home’s market value; with an alternative lender, we can usually go to about 85% of the market value.

 

If you would like to explore your refinancing options, complete our Online Application.  Once we receive your application, we will put together some scenarios for you to think about, so you can figure out if a consolidation is a right solution for you.