Consolidating bills into mortgage
With a home equity line of credit such as the CIBC Home Power Plan, you'll enjoy additional benefits such as making interest payments only on the funds you use, not your total credit limit, and having ongoing access to funds up to your authorized credit limit.
The great offers you get on your first mortgage deal don’t last forever and are usually there to reel you in for the long haul.
However, switching to a remortgage deal could also cost you, unless the provider is offering you a fee-free deal.
In order to switch to a remortgage deal, you will often have to pay an early exit fee along with the legal costs and a survey.
If you’ve already paid off the bulk of your mortgage then it may not be worth paying for a remortgaging deal as the savings you make will struggle to cover the cost of the switching fees.
Whatever happens, it’s good to shop around the market even if you’re not looking to remortgage your property immediately.
Regardless, it takes around one month for a remortgaging deal to go through, so it’s a good idea anyway to be ready for it.The mortgage type you choose will affect how well the remortgage deal works in your favour.If you can afford to take the risk then a tracker mortgage could be ideal while rates are low.The less you need to borrow, the more likely that better deals will become available to you.It’s worth bearing in mind that the new mortgage provider you switch to will need to value your property, so be prepared to research the local house prices and make a note of any home improvements you’ve made, just in case they come back to you with a lower than expected estimate.To help yourself save money, compare the annual percentage rate (APR) between your current mortgage and other remortgage deals on the market, then assess whether or not this will better the costs.You will normally have to pay a mortgage exit fee if you remortgage, but the savings could be worth it Improving the remortgage offers you’re likely to be accepted for comes down to your personal circumstances and the loan-to-value (LTV) you apply for.In essence, avoid remortgaging for debt consolidation and see if you can pay off your existing debts separately instead.Once you’ve figured out what you need your remortgage deal for, be it debt consolidation or saving money, then it’s time to decide what type of remortgage you need.While mortgages will offer far lower interest rates than credit cards and an improvement on personal loan rates, that doesn’t mean that remortgaging for debt consolidation will save you money.As you’re more likely to be paying off your mortgage for a longer period than your other debts, you are also more likely to be paying much more.