Mortgage Refinancing in Gatineau: Everything You Need to Know
Refinancing lets you tap part of the equity built up in your home. If you bought a few years ago, your equity may have grown, but only an up-to-date valuation can confirm it.
What Is Refinancing?
Refinancing means replacing your current mortgage with a new, typically larger one, to access the difference in cash. You can refinance up to 80% of your property's value, the cap OSFI sets for an uninsured mortgage.
When to Refinance?
Good Reasons to Refinance
- Major renovations: Kitchen, bathroom, basement, addition
- Debt consolidation: Combine high-interest debts
- Real estate investment: Down payment for a plex or rental condo
- Children's education: Fund education at lower cost
- Emergency fund: Create a financial cushion
Bad Reasons to Refinance
- Consumer spending: Travel, luxury car
- Paying debts without changing habits: Risk of falling back into debt
- Uncertain market: If rates are rising sharply
How Much Equity Do You Have?
Example for a Gatineau home:
- Current market value: $500,000
- Mortgage balance: $300,000
- Available equity (80%): $400,000 minus $300,000 = $100,000
Refinancing Costs
- Early repayment penalty: according to FCAC, usually the higher of 3 months' interest and the interest rate differential, and the method varies by lender
- Notary fees and appraisal fees: ask for a quote, they vary by file
- Other fees: vary by institution
My Advice
Before refinancing, get your property appraised to know its true market value. I can provide a free valuation and refer you to trusted mortgage brokers in Gatineau.
Read also: Notary & Closing Costs · Renovations That Increase Value