Increase the comfort and enjoyment of your home
Do you want to increase the comfort and enjoyment of your home? Are you planning to be there for the foreseeable future? If your dream home is one renovation away, we’ve got a smart tip. If you have enough equity in your home, roll the cost of your renovation into your mortgage. This will allow you to access low-cost financing, with one easy monthly payment. You can then use your prepayment features to pay if off faster.
If you’ve owned your home for a few years, chances are you’ve been building up some nice equity. And with mortgage rates hovering around historic lows, this is a great time to look at rolling the cost of your renovation into your mortgage. In fact, you might find enough interest savings in your new mortgage to help knock down the overall cost. Renovations are an excellent way to increase the market value of your home.
Purchase Plus Improvements Mortgage
If you’re buying a fixer upper, you could complete your renovations before you move in with a Purchase Plus Improvements Mortgage. There are many great older homes that are just waiting for the perfect renovation in Mississauga, Brampton, Oakville, Toronto and the GTA.
Many home-buyers looking to buy older properties find themselves in a common predicament. They’ve found a property that suits them, but it needs some costly and immediate upgrades. Increasingly, buyers are adding the costs of those immediate renovations into their mortgage, instead of racking up credit card bills or selling investments to pay for the upgrades. This is known as a Purchase Plus Improvements Mortgage. This type of mortgage covers the sale price of the home, plus any renovations that would increase the value of the property, with as little as 5 per cent down.
If you’re buying a home but want to add a second storey, finish a basement or redo a kitchen, it can make a lot of sense to add those costs to your mortgage. That way you can spread your payments over the life of the mortgage. This is a cost-effective way to get your dream home. You can also use your pre-payment privileges to pay the renovation off faster. The process is quite simple:
- Obtain cost estimates for the upgrades
- Get your appraisal – for the value of the property “as is”, and the estimated value of the property once the improvements are completed
- Renovation costs are included in your mortgage
- Complete your upgrades
- Renovation funds are released by your solicitor upon completion
If you are considering a large renovation, talk to us about the full range of renovation financing options available to you.
