Reposition your Debts through Mortgage Financing
If you’re a homeowner looking to optimize your finances,
consider taking advantage of your home’s equity to reposition
any existing debts you may have.
If you’ve accumulated consumer debt, the payments required
to service these debts can make it difficult to manage your
daily finances. A consolidation mortgage might be a great
option for you!
Simply put, debt repositioning or debt consolidation is when
you combine your consumer debt with a mortgage secured to
your home. To make this happen, you’ll borrow against your
This can mean refinancing an existing mortgage, securing a
home equity line of credit, or taking out a second mortgage.
Each mortgage option has its advantages which are best
outlined in discussion with an independent mortgage
Some of the types of debts that you can consolidate are:
● Credit Card
● Unsecured Line of Credit
● Car Loan
● Student Loans
● Personal or Payday Loans
Most unsecured debt carries a high interest rate because the
lender doesn't have any collateral to fall back on should you
default on the loan. However, as a mortgage is secured to your
home, the lender has collateral and can provide you with lower
rates and more favourable terms.
Debt consolidation makes sense because it allows you to take
high-interest unsecured debts and reposition them into a
single low payment.
So, when considering the best mortgage for you, getting a low
rate is important, but it’s not everything. Your goal should be to
lower your overall cost of borrowing. A mortgage that allows
for flexibility in prepayments helps with this. It’s not
uncommon to find a mortgage at a great rate that allows you to
increase your payments by 15% per payment, double your
payments, or make a lump sum payment of up to 15% annually.
As additional payments go directly to the principal repayment
of the loan, once you’ve consolidated all your debts into a
single payment, it’s smart to take advantage of your
prepayment privileges by paying more than just your minimum
required mortgage payment, as this will help you become debt-
While there is a lot to unpack here, if you’d like to discuss what
using a mortgage to reposition your debts could look like for
you, here’s a simple plan we can follow:
1. First, we’ll assess your existing debt to income ratio.
2. We’ll establish your home’s equity.
3. We’ll consider all your mortgage options.
4. Lastly, we’ll reposition your debts to help optimize
If this sounds like the plan for you, the best place to start is to
connect directly. It would be a pleasure to work with you.