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Vice-President, National Sales
Jason Provencher Phone: 403.472.7340 Toll Free: 1.888.472.7340 Fax: 403.718.3042 jprovencher@bridgewaterbank.ca
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Lower Mainland, Island and northern British Columbia
Yvonne Futter Phone: 604.506.7114 Toll Free: 1.866.867.1777 Fax: 403.718.3042 yfutter@bridgewaterbank.ca
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Select a location from above to display BDMs
Contact a BDM
Vice-President, National Sales
Jason Provencher
Phone: 403.472.7340
Toll Free: 1.888.472.7340
Fax: 403.718.3042
jprovencher@bridgewaterbank.ca
Headshot of Jason Provencher
Lower Mainland, Island and northern British Columbia
Yvonne Futter
Phone: 604.506.7114
Toll Free: 1.866.867.1777
Fax: 403.718.3042
yfutter@bridgewaterbank.ca
Headshot of Yvonne Futter

4 Worthy Reasons to Refinance the Home

Have your customers considered refinancing to pay off vacation expenses or their children’s tuition? Has their financial situation recently changed? Maybe they’re looking to renovate their home or invest? Here are some tips and considerations to share with your customers who need help refinancing a mortgage.

Reason 1: Pay-off debts, home renovation, create wealth

If your customer answers yes to any of the following, it might be time to think about refinancing:

  • They want to pay off debts quicker and cheaper by consolidating them
  • Their financial situation has changed
  • They plan to renovate soon
  • They want to use the equity in their home for a wealth creation strategy
  • They want to use the equity to purchase an investment property

Reason 2: Improved Credit

If your customer has improved their credit score, it might be time to consider refinancing to get them a better mortgage refinance rate. To do this:

  • Pull a copy of your customer’s credit report before beginning the refinancing process (TransUnion or Equifax)
  • Then, work with your customer to clear up any mistakes on their credit report to put their best foot forward in the qualification process

For customers who have mortgages with private lenders, beacon scores as low as 500 are eligible for lower-rate, alternative mortgages.

Related: Know The 5 Cs of Credit to Accelerate a Submission

Reason 3: Need more income to increase household cash flow

If your customer requires more monthly income, it might be time to consider refinancing. Perhaps your BFS customer has less monthly income due to an economic downturn or COVID-19 pandemic, or their spouse lost their job. Alternatively, their debt load may have increased because of a major life event. Whatever the reason, the need for increased monthly cash flow may exist.

One option is to lengthen their amortization*. While doing this means they’ll be paying their mortgage longer, it can make the difference in meeting their immediate monthly cash needs. Ideally, this would be a temporary solution to handle short-term financial hardships backed with a plan for your customer to shorten the amortization upon renewal (to avoid prepayment charges and fees) once they’re back on their feet.

Reason 4: Shorten a mortgage term

If your customer wants to know how to shorten their mortgage term, it might be time to think about refinancing. If your customer is in a higher-rate mortgage, you can help them maximize their savings by opting for a new loan with a shorter term which could save them thousands of dollars over the life of the loan. Things to consider:

  • Refinancing typically involves prepayment charges which will lower the savings
  • Charges vary from lender to lender
  • Prepayment charges should always be factored into the calculations of how much refinancing might save, as should any fees

In any case, your customer has options. Whatever their reason for refinancing a mortgage, you can help them make a responsible and informed decision. To discuss any refinance deals you may have, contact your local BDM.

*Subject to credit approval.

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