Refinancing mortgage for lower rate - good or bad move?

[nagooro]

Hoping someone else can shed some light on this, in case I am missing anything.

Mortgage balance of 500K (today), started Sept 2017
Current rate: 5 year variable - weekly accelerated - prime minus 0.4% - 3.05%
If refinanced: 5 year variable - weekly accelerated - prime minus 1% - 2.45%

I did some comparisons using TD's mortgage calculator (3.05% vs 2.45%), is it worth refinancing the rate to get the interest 0.6% lower?
Is $4k in fees realistic?

IMO seems like it would be a good move, saving about $5-6K after a 5 year term (assuming penalty is around $4k). Am I missing any other variables? Other things to consider?

Thanks

[cet]

I'm doing the same thing at the moment. I worked with Tim and in my case it was worth it. Doing an apples to apples comparison I am $4000 to $5000 better off at the end of when my current mortgage term would end as well as dropping the amortization period from 30 years to 25.

[roopi]

If you are saving money in the end I don't see any reason why you shouldn't do this. Just make sure you figure out all your costs with breaking the current mortgage and costs of the new mortgage (possible appraisal?).

[Sorath]

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If you are saving money in the end I don't see any reason why you shouldn't do this. Just make sure you figure out all your costs with breaking the current mortgage and costs of the new mortgage (possible appraisal?).

this, however usually most mortgage brokers will pay for appraisal fees and land titles. Only thing you have to worry is if you have a penalty on your mortgage.

[ercchry]

So you want to pull money out? True refi? Do it quick, TD wants those deals in by the 31st and that’s a crazy deal for something that’s not insurable

[nagooro]

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I'm doing the same thing at the moment. I worked with Tim and in my case it was worth it. Doing an apples to apples comparison I am $4000 to $5000 better off at the end of when my current mortgage term would end as well as dropping the amortization period from 30 years to 25.

Do you know the approximate amount of penalties/fees you will have to pay up front?

[Xtrema]

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Do you know the approximate amount of penalties/fees you will have to pay up front?

It's in your contract.

According to this it's ~$4000.

https://www.ratehub.ca/penalty-calculator

Remember, you are early in the mortgage. You may save $2K if rate stays at 2.45%, 2 rate heights and you lose.

[nagooro]

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It's in your contract.

According to this it's ~$4000.

https://www.ratehub.ca/penalty-calculator

Remember, you are early in the mortgage. You may save $2K if rate stays at 2.45%, 2 rate heights and you lose.

If I'm already on a variable mortgage, if prime goes up, wouldn't both rates mimic the rise, so in the end I will continue to be 0.6% lower than my current rate?

[Xtrema]

Nvm, carry on