Save on your mortgage
With interest rates so very low if you have a mortgage it is important to check the rate & make sure you negotiate a new interest rate if today's rates are lower than what you have been paying. This will save you hundreds of dollars. Here is what a mortgage broker friend Tracy Turnell said
I was always told that anytime there is a 1% (or more) difference in the rate you have to the new rate you can get it is worthwhile from an savings perspective to look at refinancing. I am finding that many homeowners are investing the time to relook at their cost of interest savings now. You don't need to increase the mortgage unless you have a debt to roll into the mortgage that has a higher interest rate then the mortgage. Prime is now at 2.75% and some lines of credits are Prime PLUS anywhere from .50% to 2% which would equate to 3.25% to 4.75% (monthly compounding). Why not roll that Line of credit or credit card into a 5 year term at 2.05% (semi-annually compounding) and save the interest which would lower monthly payments dramatically! OR, you could just roll the hundreds of dollars monthly in savings and put straight on the principle of your home.
Example:
Actual Scenario
$300,000 Mortgage 35 year ammortization @ 5.39% with 63 months left of the 7 year term. The lender quoted $17,839.88 prepayment penalty. Their monthly payment is $1,577.87. Rolling the penalty into the mortgage gives them now a $318,000 (approx) mortgage. At the new interest rate of 2.05% for 5 years (60 months), their new payment is $1,060.17. That is a savings of $517.70 per month! The big question is, "How long is it until they've saved the equivalent as their penalty"? The answer is, at 34 months, they have saved $17,839.88. Over the life of the mortgage term, their savings will equate to $31,062.00! The bonus is that they still have 2 years after that to enjoy their interest savings.
I can preapprove and rate secure as well. The process takes about 15 minutes.
Tracy Turnell
Mortgage Professional
Cell: 604.961-0670
Home: 604 941-1163
e-mail tracyturnell@shaw.ca
e-mail tracyturnell@shaw.ca