If you are a homeowner who was lucky enough to buy when mortgage rates were low, you may have no interest in refinancing your present loan. But perhaps you bought your home when rates were higher. Or perhaps you have an adjustable rate loan and would like to switch to a fixed rate. If you do refinance, the process will remind you of what you went through in obtaining the original mortgage. That's because, in reality, refinancing a mortgage is simply taking out a new mortgage.

CAN I REFINANCE?
YES! At Terra Nova Financial Services Inc. we don't restrict the number times you can refinance your loan. Although there may be costs associated with refinancing, it may be in your long-term best interests to do so. The process will be similar to when you obtained your existing loan (although at Terra Nova Financial Services Inc. we'll do it without all the hassles!). To find out if refinancing is right for you, visit our Current Interest Rate Page and see how your current rate compares to rates currently offered by Terra Nova Financial Services Inc.

SHOULD I REFINANCE?
You should if you:

• Want to get out of a high interest rate loan to take advantage of lower rates.
• Have an adjustable rate mortgage (ARM) and want a fixed-rate loan to have the certainty of knowing exactly what the mortgage payment will be for the life of the loan.
• Want to convert to an ARM with a lower interest rate or more protective features (such as a better rate and payment caps) than the ARM you currently have.
• Want to build up equity more quickly by converting to a loan with a shorter amortization.
• Want to draw on the equity built up in your house to get cash for a major purchase or for your children's education.

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SHOULD YOU REFINANCE YOUR ARM?
In deciding whether to refinance an ARM you should consider these questions:

• Is the next interest rate adjustment on your existing loan likely to increase your monthly payments substantially?
• Will the new interest rate be higher than the prevailing rates being offered for either fixed-rate loans or other ARMs?
• If the current mortgage sets a cap on your monthly payments, are those payments large enough to pay off your loan by the end of the original term?
• Will refinancing a new ARM or a fixed-rate enable you to pay your loan in full by the end of the term?

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WHAT ELSE SHOULD I KNOW?
There are other considerations, too, such as how long you plan to stay in the house. Most sources say that it takes at least three years to realize fully the savings from a lower interest rate, given the costs of the refinancing. (Depending on your loan amount and the particular circumstances, however, you might choose to refinance a loan that is only 1/4 percent percentage points higher then the current rate. You may even find you could recoup the refinancing costs in a shorter time.)

For the answers to these and any other refinancing questions call a Mortgage Expert at Terra Nova Financial Services Inc. at 905-625-7460 or E-mail us.

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