- who: Homeowners
- real estate goals: Vacation home in Mexico
- issues: Accessing equity
When you refinance, you are breaking your existing mortgage for new borrowing terms. This enables you to get a better mortgage rate, lower your monthly payment or access cash, which can go towards paying for renovations.
When you refinance, you are breaking your existing mortgage for new borrowing terms. This enables you to get a better mortgage rate, lower your monthly payment or access cash, which can go towards paying for renovations.
Assess your current financial needs and goals. Talk to a Perch mortgage advisor if you have questions.
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5-year variable
5-year fixed
You will need to determine how much equity you have available through your current property. This will help you set a budget for your renovations. Having a renovation budget is important so you know exactly how much you will need in order to get the job done. It’s best to consult your mortgage advisor and understand how much you will need and what you can afford.
In order to refinance, you will need to break your mortgage. This involves renegotiating the terms of your mortgage before your renewal and maturity date.
When you break your mortgage early, you will likely incur penalties. Talk to your mortgage advisor or use our mortgage penalty calculator to run different scenarios and get an estimate before confirming with your lender. It’s important to note that this number might change and won’t be finalized until a payout statement is requested.
In this step you will need to review everything with your mortgage advisor. Your mortgage advisor will help you consider your options, including your current lender or with other lenders.
It’s important that you follow through with steps 1 and 2 before making a decision. Some lenders will try to get you to stay with them at a high rate by waiving the penalty fees. Work with your advisor to find a rate that is beneficial for you, as there are options that might be able to cover your penalty and give you a better rate.
This step is similar to when you purchased your home, however, it is a much simpler application. All you need are the basic proof of income documents and your latest annual mortgage statement.
Renovations can be overwhelming but with a plan and budget in place, your dedicated Perch mortgage advisor can help you through the process. Sign up for a Perch profile to get started.
Refinancing is a great option for those who want to pay for renovations because of the potential to extend your amortization, which can result in a lower monthly mortgage payment, and possibly provide better rates. Other options to access cash, such as personal loans, tend to have higher interest rates. It’s best to work with a trusted mortgage partner to understand the different ways you can leverage your home equity before making a decision.
Renovations and improvements can:
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Homeowners
