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Free Professional Advice

Why choose Micah? Because I provide valuable professional advice and it’s FREE!

Why pay more than needed? Get my rate specials. Let me negotiate the best rate for you and save money.

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Let me shop the major banks and top lenders for you.

Let me negotiate the best rate. Remember I work for you, not the banks.

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My approval rating is high.

With my portfolio of lenders, I can find you a program that works for you.

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Lower rates equals thousands in savings.

Why pay more than needed? Get my rate specials. Let me negotiate the best rate for you and save money.

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Blog by Micah Verceles

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Consolidating debt within a mortgage: Good idea?

Recently I showed a close friend of mine how to consolidate their high-interest debt into their mortgage to reduce their overall interest rate and free up hundreds of dollars in cash flow every month. Debt consolidations are nothing new, but they only work if the person is not simply looking for a quick fix.
 
In this particular case, $410 was freed up in monthly cash flow and the refinanced mortgage interest rate was lower. In many situations, however, consolidating debt into a mortgage comes at a cost: You must break your current mortgage and the high-interest debt then gets amortized into the new mortgage balance at a lower interest rate. Your overall debt goes up by a few thousand dollars (the cost to break the term and perhaps paying a CMHC premium on the increased balance on the mortgage), the rate of interest you pay overall goes down, but those high-interest debts are now being paid off over much longer periods of time.

So what's better? Well with today's low rates, the answer more often than not is, 'Yes', but to be sure contact me I'll do the math for you. 

Micah Verceles
Mortgage Consultant
604 897 8927
micah@citywidemortgage.ca