Refinancing Your Calgary Mortgage

November 27, 2008  
Filed under Refinancing

Each person has a different reason to refinance their Calgary home. They can range from taking out extra money to finance renovations or to consolidate debt, to withdrawing equity to invest it and make your mortgage tax deductible using the Smith Manoeuvre. Whatever your reason for refinancing, it can be a great tool.

One major rule to keep in mind when considering refinancing your home is that you must own your own home. If you’re a renter, you can’t refinance since you have nothing to refinance. If you qualify, you can refinance your home up to 95% of its value (to be determined by an appraisal), but you will be required to pay a mortgage insurance premium to CMHC, Genworth or AIG. Alternatively, if you want to avoid paying that insurance premium, you can withdraw less than 80% of the value of your home (since your mortgage will then be considered “conventional” and not premium is required).

If you’re looking to refinance, there are some fees associated with the transaction that you should keep in mind. You will be required to pay an appraisal fee, legal fees, and perhaps a prepayment penalty with your current lender if you are breaking your mortgage term. Generally speaking, you are able to build those costs into the mortgage amount requested for your refinancing. That way, you’ll only have to pay for those fees out of your pocket initially, and will be reimbursed once your mortgage is funded.

If you’re living in Calgary and would like to explore your refinance options, we are more than happy to help you out! Please contact us today.


One Response to “Refinancing Your Calgary Mortgage”

  1. Calgary Mortgage Brokers on September 2nd, 2010 12:49 pm

    Another good thing to think about when you are refinancing is if the penalty is worth the refinance. Ie. if you have to pay a $5k fee just to access an extra $15k perhaps a small second mortgage would save you more money.

Feel free to leave a comment...