How to Refinance Your Home Loan Before the Foreclosure Notices Come

Uncertainty about the future, mounting bills, and other financial problems has more Canadians than at perhaps any time in recent memory wondering about their ability to remain in their homes. 

If you’ve missed a mortgage payment or two and are facing possible foreclosure or you know it’s just a matter of time before your lender chooses send you foreclosure notices, you should consider refinancing your home – especially if your credit hasn’t been too badly affected. 

Here are some factors for you to consider – and steps you can take now that will leave you with better options than waiting for the postman to deliver  foreclosure notices.

Your Credit Situation – If you’re facing foreclosure, your financial back is against the wall, and you need to find an effective solution before you run out of time.  Unfortunately, with every missed payment your credit score will take a hit, which will reduce your creditworthiness in the eyes of lenders.

If you aren’t yet in foreclosure, but you can read the handwriting on the wall, you should seek refinancing sooner rather than later. 

Your refinancing options are better with a higher credit score, in terms of the interest rate and repayment terms you’ll be offered.  If you are still in the earlier stages of your existing loan, refinancing may be an excellent idea, especially if you can reduce your monthly payment, lower your interest rate, or pay off other debt. 

However, if you’ve suffered significant credit damage, it might be difficult to save money in the long run, but if you’re faced with losing your home (and you really want to keep it) it might still be worth it to refinance anyway.

Your Current Interest Rate, Equity Amount, and Loan Balance – A lot of Canadians have home mortgage loans with high interest rates, compared to some of the low rates available in today’s market.  In addition to rescuing you from impending foreclosure, it is entirely possible that you could wind up with an even better financial situation than the one in which you currently find yourself.

Property values have fallen somewhat in some areas, which will reduce the amount of equity you have in your home.  Shop the market quickly for the best refinance package you can locate, keeping in mind that your new interest rate and the loan amount will affect the amount of your new payment.  Follow this link for our handy mortgage calculator to figure your potential savings – while avoiding foreclosure notices.

Your Other Debts – Whether or not you’re currently in foreclosure or are simply a missed payment or two away from getting a foreclosure notice, other debts you have can impact your ability to make your mortgage payments as scheduled.  If the crushing burden of debt is pushing you closer to the brink of foreclosure, refinancing your home may be one of the quickest foreclosure solutions available.

By refinancing now, you can put some of the available equity in your home to work for you in reducing your payments and easing your budget burden.  Refinancing can free up cash to pay off existing debts and allow you to forego foreclosure as one of your only options.

In order to avoid foreclosure, you’ll need to expedite your search for a potential lender for your refinance loan.  A good, experienced mortgage broker experienced in difficult financial situations can help you to stay in your home and come back from the brink of financial disaster.

That’s really what it’s all about, isn’t it?

Need to unlock your home's equity - but have a few questions? Why not consider a free private email consultation with me, Darrin Roseborsky? There's no obligation or commitments to worry about. Just helpful answers to your questions. Use the short form in the top-right corner to get started. And in a few minutes, you'll have the answers to all of your questions.