How to refinance your mortgage with bad credit?
To say that these are uncertain times would be an understatement! The COVID-19 virus is not only causing a global health crisis, but an economic one as well. Over the next few months there may be may bankruptcies and job losses ahead. The Government of Canada is doing what it can to mitigate the damage and one of the things that is being done is that the Bank of Canada has lowered interest rates. This means that it just might be a good time to refinance your mortgage. In this article, we will discuss how you can refinance your mortgage if you already have bad credit.
What does it mean to refinance your mortgage?
When you refinance your mortgage, you are breaking your first mortgage in order to get a new one – usually at a lower interest rate. When breaking your first mortgage, you will have to pay a financial penalty to your lender, so it’s important to consult with your mortgage broker to see if you will actually be saving money when you refinance.
Why refinance now?
As mentioned, the Bank of Canada has recently lowered their interest rates. Depending on what you are currently playing on your mortgage, you could literally be saving yourself thousands of dollars just by refinancing and lowering your interest rates.
The other reason you might want to consider refinancing is if you currently have other high-interest debt. Provided that you have enough equity in your home, you can use a mortgage refinance to consolidate your debt. This could save you a considerable amount of money in interest as well as help to lower your monthly debt payments overall. And this could prove especially important if we find ourselves in a recession for any length of time.
Can I refinance my mortgage with bad credit?
Refinancing your mortgage when you have bad credit will be more difficult, but it is not impossible. While you will not be able to get a refinance with the major banks, the team at Matrix Mortgage Global has access to lenders who specialize in helping people with poor credit. And if you use refinancing as an opportunity to consolidate your debt and pay it off more quickly, refinancing may even be a way to improve your credit.
Would you like to talk to one of our professionals about refinancing your mortgage? Contact us today!