In today’s B’s Finance Minute, let’s talk about readvanceable mortgages. Most Canadians are familiar with the traditional type of mortgage where over time, the principal amount that you owe on the mortgage goes down. But, if you want to access your equity it can be a challenge.
There has to be a better way. Yes there is. It’s called Readvanceable Mortgage. It’s like a combo:
There’s a mortgage and a line of credit connected together. Over time the amount of your mortgage drops and the amount of your line of credit increases. If in 5 years time the mortgage amount goes down by $100,000, then the matching line of credit will go up by $100,000.
What’s important about this?
First, it saves you time and hassle in the future if you need to access your equity for various purposes like debt consolidation, renovation or investments.
Second, the best time To apply for a line of credit is when you don’t need it. Banks tend get strict when people are desperate or needy.
Third, mortgage rules become tighter over time so it’s best to have it in place before you don’t qualify anymore.
If you want to know more let’s talk and please like and share so I can make a difference in the lives of thousands!