Debt consolidation
Cards, lines of credit, car loans, CRA arrears and collections can all be paid out through a refinance, leaving one secured payment at a mortgage rate.
02 — Equity
Your equity isdoing nothing.Put it to work.
Refinancing replaces your existing mortgage with a new, larger one and hands you the difference. Done for the right reason it clears expensive debt and lowers what you pay every month.
- 80%Maximum loan-to-value on a refinance in Canada
- 1Payment, replacing however many you are juggling now
- 2ndAnd third mortgages can be rolled into the new first
- IRDPenalty modelled before you commit, not after
What refinancing does
A refinance pays off your existing mortgage and any other legal claims registered against the property, and replaces all of it with one new mortgage. If the new mortgage is larger than what you owed, the difference comes to you in cash on closing.
The most common reason is arithmetic. Credit cards run at nineteen to twenty-nine percent and unsecured lines of credit are not much better. Mortgage money is secured by real estate and priced accordingly. Moving thirty thousand dollars of card debt onto a mortgage can cut the monthly cost of that debt by more than half.
The catch is the penalty for breaking your current term, and the fact that spreading short-term debt over a twenty-five year amortization can cost more in total interest even while the monthly payment drops. Both are arithmetic too, and we run them before you sign anything.
What we can do here
Combining multiple mortgages
If you are carrying a second or third mortgage, folding them into a single new first is frequently worth thousands a year on its own.
Renovation funding
Cheaper than a construction loan and far cheaper than a credit card, provided the equity is there to support it.
Down payment for the next property
Pulling equity out of the home you own is the usual way people fund a rental or a second property.
Penalty modelling
Three months' interest on a variable, or the interest rate differential on a fixed. IRD calculations differ wildly between lenders and are frequently misunderstood. We get the real figure from your lender in writing.
Blend and extend
Sometimes the better move is not breaking the mortgage at all. Some lenders will blend your existing rate with a new one and extend the term, avoiding the penalty entirely.
How it runs
From first call to funded.
What to have ready
- Your current mortgage statement showing balance, rate and maturity date
- A recent property tax bill
- Statements for every debt you want to clear, with balances and rates
- Proof of income — pay stubs, or tax filings if self-employed
- Home insurance details
- Photo ID
- 01
Establish the equity
What the property is worth today against what you currently owe. That gap, to a maximum of 80% of value, is what you have to work with.
- 02
Price the exit
We request your exact payout penalty from your current lender and compare it against the saving from refinancing.
- 03
Structure it
Which debts to clear, what the new payment looks like, and whether a mortgage, a HELOC or a second is the right instrument.
- 04
Close
Appraisal, lender conditions, lawyer. Your old mortgage and the debts being consolidated are paid out directly on closing day.
Questions
Refinance — the common questions.
More in the full FAQ, or call 416 230 2920.
How much can I take out?
Up to 80% of your home's appraised value, minus what you still owe. On a $900,000 home with a $500,000 mortgage that is $720,000 less $500,000 — $220,000 available, subject to qualifying.
What will breaking my mortgage cost?
On a variable rate, typically three months' interest. On a fixed rate, the greater of three months' interest or the interest rate differential, which can run into five figures. The formula varies significantly between lenders, so we get the actual number from yours rather than estimating.
Is consolidating debt into my mortgage always a good idea?
No. It lowers your monthly cost, but stretching a five-year car loan across a twenty-five year amortization can cost more interest overall even at a lower rate. It works when it frees up cash flow you genuinely need, or when you keep the payment the same and clear the balance faster. We will tell you when it does not add up.
Do I need a new appraisal?
Almost always, yes. Refinances are priced on current value and lenders will not take your word for it. Budget $400 to $600, occasionally covered by the lender.
Talk to a broker