We love to provide debt-reduction advice and money-saving suggestions.  Our goal is to find the right strategy for you.

Here are some reasons why our clients consider refinancing:  

a) To take advantage of lower interest rates.

b) To consolidate loans and existing higher interest rate debt(s).

c) To renovate 

d) To assist a child in college/university

e) To purchase an investment property

f) To scratch something off the bucket list!

Read on to learn more about refinancing your mortgage with Anita Groves Mortgage Team

In Canada, most homeowners can access up to 80% of their home’s value (85% with some lenders). Usually, this is called an ETO or Equity Take Out. An ETO can be done by getting a brand-new mortgage with a different lender, taking out a home equity line of credit, or blending and extending your mortgage with your current lender.  

**Note that there are usually penalties/fees involved.

Fees with Refinancing

This depends on the strategy used to access your equity. One of the fees associated with refinancing your home may include a penalty to break your current mortgage.  If the qualifying ratios are in your favour, we can often add the amount to break your existing mortgage into the replacement mortgage. 

We can generally calculate for you, what the fee would be, but it is also a good idea to contact your current mortgage holder first, to find out what their calculation is and get an estimate. Each lender uses their own posted rates to determine the formula and most charge a 3-month interest penalty or an IRD (interest rate differential) calculation for breaking your mortgage. 

Legal costs are also to be expected, as a lawyer must adjust the amount financed attached to the property title.

Along with the application, we will request a signed consent to pull a credit report.  The credit report will reveal how well you have managed credit.   We will also request documents to support the income reported on your application.  

We ask for your understanding and cooperation during this initial process, as there may be many other questions we will ask.  The information you provide is then reviewed by the lender prior to agreeing to lend you money.  Your honest answers to these questions will help us to work with you and guide you into the best mortgage based on your situation.

There are several ways you can submit an application to us. You may apply on-line here (link to app), by phone or in house, our office or your location. We can also fax you an application form if you wish.

There are certain guidelines that an applicant must meet in order to refinance.  One of them is to verify property value. This is usually done by way of an appraisal and/or inspection report. 

Lenders will condition this in the commitment and will provide a list of approved appraisers or an automated appraisal service that we are mandated to use. In turn, we order the appraisal on your behalf. Then the appraiser will then contact you and determine a convenient time for both parties.

In some cases, we will order the appraisal prior to receiving a commitment from the lender (we will find out who the approved appraiser is) if we think that the value might present a tight margin for the ratios we are using for you to qualify.

This report is sent directly to the lender. 

Again, a refinance is 80% loan to value.  For example, if the property is valued at say, 400,000.00. 80% of that amount, 320,000.00 would be 80% LTV or loan to value.   Once the value is determined we then proceed with your mortgage transaction.

It is our job to sell your application to the lender to ensure you get the best possible rate and terms for your situation. By this time, the lender has reviewed the application we have submitted, and they then issue a commitment of approval.

This commitment of approval will be subject to meeting certain conditions such as income documents, appraisal report, etc. It will state specifically which documents the lender requires for income such as NOA’s, T1 Generals, paystubs, employment letters, etc.  In anticipation of this, we typically request these documents from you up front and will already have them on file.

Each client’s commitment is different and targets specific criteria. The commitment comes to us directly. We then build, what we refer to, as the “signing package”.  

As we review this commitment of approval with you, we still have the ability to change the rate and term, payment amount or frequency, etc. (as long as your ratios are still in line with what is acceptable to the lender). 

We can send the “signing package” by email or review it with you at our office.   In either case, we review this package with you page by page, either in person or over the phone.  Besides the commitment of approval, there are other documents included in “signing package”. We are required by law to provide certain information; fees, closing costs, mortgage insurance, etc. We go over all of this and provide a copy of the signed documents to you.

Once you have chosen a real estate lawyer to work with, we provide their contact information to the lender. As part of our service to you, we then forward all of the documentation your solicitor.  

In time, the lender will then send “Instructions” to your lawyer’s office. These instructions are similar to the commitment of approval that we receive, except it contains a list of conditions that your solicitor is legally required to meet on your behalf. These conditions could consist of providing house insurance verification, confirming and requesting a payout statement from your current lender, etc. 

You will then have a meeting with your lawyer, prior to closing, to confirm all of the details and provide legal signatures.

If you don’t have or know a lawyer, we will be glad to refer you to one.

Once your lawyer has completed the work, your new mortgage will be registered on your property title and in place. 

Now you can sit back and relax; enjoying the benefits of what this new mortgage will bring you. 

Even after closing, if you have any questions don’t hesitate to contact our office.