RESOURCES
Your property is a good guaranty for a bank. When refinancing it on its present-day market value you can generate an interesting equity (Equal to de difference between 75% to 90% of your property’s value minus the mortgage balance due). That equity will grow with your property’s market value. It will enable you to benefit from :
- A financial margin to renovate with or to implement a project, buy an income property, etc…
- Consolidate debts at lower interest rates and not at often-times very high rates.
| Property Value | 200 000 $ |
| 90% Refinancing | 180 000 $ |
| Minus Mortgage Residual | 100 000 $ |
| Available Credit Margin | 80 000 $ |
| Client debts | Limit |
Balance |
Mthly. Payments |
| Personal loan 10% on 2 years | 2000$ |
92$ |
|
| Visa | 5000$ |
5000$ |
250$ |
| Master card | 5000$ |
5000$ |
250$ |
| Car loan (12% on 3 years) | 15000$ |
498$ |
|
| Margin | 10000$ |
7000$ |
300$ |
| TOTAL | 34000$ |
1390$ |
If we negociate a 6% rate on the client’s behalf and we hike his loan to meet all of his debts, a 69,000.00$ loan would be needed (We could go up to 75% of his property’s value** so, 75% of 125,000.00$ = 93,750.00$)
New loan amount :
35 000.00$ present-day mortgage + 34 000.00$ in debts = 69 000.00$.
We chose a 15 year amortization period, the monthly payment will then be of 579.52$ instead of 404.58$ + 1390.00$ (Other debts) = 1794,88$. Witch represents a monthly savings of 1215,36$
