Refinance with Current Lender: Yes or No

Refinancing Faizal Garasia 18 Mar

Choosing to refinance with your current lender may help you simplify the process and save you time. However, there are numerous factors that you need to consider before you make this decision. It is a smart idea to shop around for multiple lenders to get the most favorable deal for you.

In this article, we will discuss if you should refinance your mortgage with the same lender or not.

Refinance Defined

Refinancing is the process where the current mortgage is replaced by a new one that pays off the balance of the previous one. When you refinance, you basically change the term of your mortgage with a more affordable interest rate.

Refinancing is available for home mortgage, auto loan, insurance, and any other types of transactions involving the borrowing of money. You have the option to do this if you feel that your existing mortgage is too expensive and need additional capital to settle your amortization on time.

Or maybe you have lost or changed jobs which affected your financial condition. By refinancing your mortgage, you can adjust the term that suits your current economic circumstances.

This being said, the best time to refinance your mortgage is when your finances are good, your credit score is high, and your credit reputation with lenders/creditors is laudable.

Is It Better to Refinance with the Same Lender or Not?

“Which one is better?” you might be asking yourself.

The answer depends entirely on your current monetary situation. Speak with different lenders/creditors and check which deals match your financial status at the moment.

Another matter to consider on whether to continue with your current lender or not is current rates for mortgages . Choosing a new one will provide you with rates that are at fair market value compared to your previous one who can give you some privileges since you are a loyal customer.

Advantages of Refinancing with Your Current Lender

Here are some of the benefits of working with your current lender:

• Lower fees– if your lender wants to keep you as a client, he/she will give you the best deal to keep you in business. You may be able to negotiate the interest rate and terms with them plus they may reward you for being a loyal client.
• Shorter timeline– The process is usually faster when you work with your current lender. They have all the documents to process your application so you can close the deal faster.
• Easy communication and established relationship– This makes the entire process easier and smooth.

Disadvantages of Refinancing with Your Current Lender

Working with the same lender does not t mean you have all the advantages your lender is willing to offer you.

You need to consider a few things before leaving your current lender in lieu of a new one and these are:
• You may need to rate-shop- you want to prove to your current lender that you are serious about getting the best deal, so you may need to provide estimates from other lenders.
• You may not get the best deal offer- not all the lenders will give you the best deal that they have because they know what your current rate is, so it holds the upper hand.

Either leaving your current lender or not carries risks that you have to weigh considerably to get the best rates available from your creditors.

Compare the mortgage plan you will receive between your current and chosen new lender and then proceed from there.

When to Refinance Your Mortgage

If your current interest rate is higher than the current rates for mortgages then refinancing is a smart idea. If, on the other hand, your financial situation has adjusted and you can’t afford to pay your current rate then it is time to refinance your mortgage to get the most ideal interest rate available for you.

Final Thoughts

Refinancing your mortgage may sound easy but it is actually not. Your goal is to get a lower interest rate and save money which is the reason behind your mortgage refinancing.

Do not take the first refinancing offer you get; instead, shop around and compare the different mortgage packages offered to you. Choose a lender that provides the most favorable interest rate and terms.

Remember that you have a choice and it is your present financial status that will dictate your refinancing decision even if it means replacing your current lender with a new one.

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We are your trusted mortgage solutions experts based in Canada founded by Faizal Garasia in 2019. We have access to more than 90 lenders including the largest banks, credit unions, trust firms, and financial institutions across Canada.

We help you understand and resolve issues regarding mortgages, finances, taxes, and other loan-related payments that impact your real estate plans.

Contact us at (416) 825 0142 or send an email to faizal.garasia@dominionlending.ca today for more information.

7 Tips in Getting Your Mortgage Approved

GTA Mortgage Tips Faizal Garasia 5 Mar

Purchasing a property is a challenging but fulfilling process. The requirements for your house purchase can be difficult, frustrating, or even stressful to accomplish at some point because you either lack the funds to support your dream acquisition or need other paperwork that your mortgage professional requires.

If you are in a rut and probably need to borrow to funds to buy your dream house but have nowhere else to go or no one else to approach then applying for a mortgage loan approval can be a task that even Ethan Hunt of Mission: Impossible™ will find confounding to sort alone.

We are unlike Ethan Hunt and likewise not members of the Impossible Missions Force. However, we can provide you with tips to help you secure a mortgage approval quickly and without any compromises.

Should you read and accept our following guide, you are assured of a mortgage loan approval that will help shoulder your property purchase with little to no hassle on your part.

This blog will self-destruct in 15 minutes.

Good luck in your mortgage loan application, home buyer!

Mortgage Defined

A mortgage is a type of loan that home buyers have to take in order to acquire and purchase land or property. The mortgage is secured against the market value or cost of your house until this is fully settled.

Lenders can repossess your property and resell it if and when you cannot repay them back or always default in your monthly amortization.

Having a property repossessed carries drawbacks to your mortgage re-application (if you are planning to secure one) since you will be assessed as financially unreliable and economically crippled to be granted one.

Tips to Get Your Mortgage Approved:

1. Show Proof of Income

Make sure you have proof of income before applying for a mortgage loan. Bankers or lenders will review your financial documents to assess your trustworthiness to repay their home loan.

You need to give a copy of at least two of your recent payslips and your last year’s tax assessment to let the bank know that your income is stable.

If you have other sources of income then you need to provide them and have these verified, as well.

2. Settle your Debts

You must take a look into your outstanding debts before submitting your home loan application. Bankers and/or lenders will check your available credit limits from any credit cards you own to see if you have any outstanding balances on them or not.

They will use this information to compute how much you can borrow and what interest rate they will give you.

Your outstanding balance does not need to be at $0.00; however, if you are targeting to have your mortgage application approval released early then you must at least try to extinguish all of your existing debts.

Doing this will impact your credit score as well and affect your lenders’ decision to grant you a mortgage loan approval. Always pay your debts on time to avoid unnecessary financial complications.

3. Present Proof of Savings

Lenders will also look at your bank history to see how well you manage your savings (i.e., cash deposits, check deposits, withdrawals, and other investments).

If you are renting an apartment then your rental payments will help them assess how responsible you are with your money and how punctual you are with your repayments.

4. Get a Good Credit Score Rating

It is necessary to know what your credit score rating is; hence, review your credit report as frequently as possible. You can get a free credit report once a year through the website, AnnualCreditReport.com.

Your credit score rating plays a big role if you plan on applying for a home loan or a mortgage loan because a high credit score means you are good at handling your credit.

This allows lenders to identify if you are a good payer will approve your loan application without having any doubts on your capacity to pay.

A high credit score means high chances of getting approval which likewise leads in getting a low mortgage interest rate.

(NOTE: Remember that having a high credit standing always means you are at the advantage to find the best mortgage rates making your mortgage loan application less steep to accomplish.)

5. Know Your Borrowing Capacity

You must know your borrowing capacity and limit before looking for a home or property. Banks have different lending policies: they calculate the amount of money they will lend you based on your capacity to pay.

It is better to clear this grey area initially before aiming at price ranges you are gunning for.

6. Shop Around and Take the Right Loan

Each lender offers different types of loans with different interest rates. After knowing your borrowing capacity, ask your mortgage broker to compare options that are available from different banks and/or credit unions.

It is better to understand their different choices available to you and learn how they will possibly affect your financial goals and needs.

This will be easier for you to get approval on your application once you find mortgage rates that suit you best and the right mortgage loan that fits your requirements.

We suggest that you compare mortgage loan plans and see which plan type bides well with your current financial status.

7. Apply for a Pre-Approval

A mortgage pre-approval makes the entire process smoother for you. The lender you have chosen will assess the information you have provided and will set a specified amount of money you can borrow, assign interest rates, and outline your mortgage loan terms, as well.

Once you successfully obtain your pre-approval, you are now in a position to purchase your dream property with full confidence.

Final Thoughts

Getting approved for a mortgage loan will help you to fulfill your dream house at an affordable rate. Keep your credit score high and it will help you live your life without worrying about your financial obligations.

Remember to settle your debts on time and be always on the lookout for opportunities to make your money grow. Maintain a bank account and be prudent in handling your finances.

Always keep in mind the seven tips presented above and you will never encounter any difficulties in securing a mortgage loan approval.

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We are your Oshawa specialists in mortgaging and in credit score restructuring for 9 years running.

Our offices are spread across Canada and we offer financial advice as well as credit assistance to our clients.

Feel free to contact us at (416) 825 0142 or send an email to faizal.garasia@dominionlending.ca.