Debt Consolidation Refinance
What is a 'Debt Consolidation' Refinance?
In today's fast-paced world, many individuals find themselves juggling multiple debts, such as credit cards, personal loans, and other financial obligations. Over time, managing these debts can become overwhelming and financially burdensome. Fortunately, a debt consolidation refinance offer a practical solution to ease the strain, streamline payments, and regain control over one's financial situation. If you are a homeowner, and have a least 20% equity in your home, we may have a solution for you.
Understanding Debt Consolidation Refinances:
Debt consolidation refinances involve the process of refinancing an existing mortgage or obtaining a new mortgage to consolidate multiple debts into one loan. This approach enables borrowers to merge high-interest debts into a single, manageable monthly payment with a lower interest rate. By leveraging the equity in their home, borrowers can secure a more favorable loan structure, combining all their outstanding debts into a single mortgage.
Benefits of a Debt Consolidation Refinance:
1. Simplified Repayment Process:
One of the significant advantages of debt consolidation refinance is the simplification of the repayment process. Instead of managing multiple due dates, interest rates, and creditors, borrowers only need to focus on a single monthly payment. This consolidation not only reduces the chances of missing payments but also provides greater clarity and control over one's financial obligations.
2. Lower Interest Rates:
Debt consolidation refinance, often offer an overall lower interest rate compared to other types of unsecured debts. By consolidating high-interest debts into a mortgage with a more favorable rate, borrowers can save a significant amount of money over time. This reduction in interest payments allows individuals to allocate more funds toward paying off the principal balance, accelerating their journey toward debt freedom.
3. Improved Cash Flow:
By consolidating multiple debts into a single payment with a lower interest rate, a debt consolidation refinance free up monthly cash flow. This surplus can be used to address immediate financial needs, invest in other areas, or contribute to a savings plan. The increased flexibility in budgeting can provide a much-needed cushion and alleviate financial stress.
4. Enhanced Credit Score:
A debt consolidation refinance have the potential to positively impact an individual's credit score. As debts are consolidated and managed more efficiently, borrowers are more likely to make consistent, on-time payments. This responsible financial behavior can gradually improve credit scores over time, leading to better borrowing opportunities in the future.
5. Streamlined Financial Planning:
With a single debt consolidation refinance, borrowers have a clearer picture of their financial situation. It becomes easier to create a comprehensive budget and set financial goals. By having a better understanding of their financial standing, individuals can make informed decisions and implement effective strategies to achieve long-term financial stability.
To qualify for Debt Consolidation Refinance, you need to have a minimum 20% equity built up on your home. The maximum debt we can consolidate cannot exceed 80% of the value of the home.
If you have any questions, we would love to hear from you. Contact us.
MAX 80% = Mortgage + Debts/ Property Value
HELPING CANADIANS SINCE 2012
Mortgage Wars have been helping Canadians qualify for home financing since 2012. We have access to multiple alternative lenders and private lenders in Ontario. We find alternative and private mortgage solutions to the most common reasons that the bank declines you.
Many Canadians struggle with high debt loads and end up falling behind their monthly obligations. Some end of having their debts go to collections, others in consumer proposals and some even end up in bankruptcies. We have access to lenders that would approve ‘bad credit’ mortgages. Alternative lenders and private lenders would consider these applications given the credit issues have been resolved and the clients have a minimum 20% down payment for purchases or 20% equity for refinances.
We also focus on business owners who struggle to prove their incomes on paper. Most business owners especially small business owners and ‘start-ups’ do not reflect a lot of income when they file for their income taxes. Most traditional lenders review the 2-year average income filed for mortgage application purposes. Alternative lenders can consider income based on income received in the last 3-6 months. This consideration can be given to business owners looking to purchase a property with 20% down payment or refinancing their homes with a minimum 20% equity.
Real Estate Investors
Aside from assisting clients with bad credit mortgages and helping business owners find alternative mortgage solutions, we also focus on helping real estate investors. As real estate prices in the Greater Toronto Area and in Ontario continue to rise, it is becoming more difficult for investors to qualify for a higher mortgage. Traditional lenders have strict guidelines on how much mortgage they can approve based on the applicant’s gross income. This is calculated using Gross Debt Service and Total Debt Service (GDS/TDS) Ratios. Alternative lenders and private lenders have more lenient guidelines and therefore allow investors to qualify for a higher mortgage needed to continue investing in real estate.