If you are carrying a significant amount of credit card debt and have equity in your home, let us analyze how much money you will save by consolidating your debts into your mortgage.
Personal loans and credit card interest rates are usually compounded daily, whereas mortgage interest rates are usually compounded semi-annually or monthly. Most unsecured debt is priced by your bank at a higher interest rate than your mortgage in order to compensate for the higher risk of loss in case you default on monthly payments. For most people it makes sense to use available home equity to pay out this debt, as it typically reduces interest costs significantly.
To consolidate your debts, your options include re-writing your existing mortgage, blending your mortgage or obtaining a second mortgage. As mortgage brokers, we have access to a variety of mortgage programs to fit almost any requirement.
For more information, look at Genworth and CMHC's guidelines.