Refinance Your Mortgage

You are on: Using Your Home Equity

Refinancing to Use the Equity in Your Home

If you need access to additional funds, using the equity in your home can be a lower cost way to borrow the money than taking out a traditional loan. For example, you can use your home equity to:

• Renovate your home
• Buy an additional property
• Invest in stocks
• Buy a car or boat

Another common reason for refinancing a mortgage is to consolidate debt such as higher interest credit card balances and loans. By consolidating these debts into your mortgage at a lower interest rate, you can save money and have all your debt in one place. Plus, our pre-payment options give you the flexibility to pay off your loan more quickly.

Advice and Solutions to Meet Your Goals

Whatever your reasons for wanting to refinance your mortgage, an RBC^® mortgage specialist will take a look at your current home equity and your goals for the future to recommend the best solution. Depending on your situation, here are a few of the refinancing solutions that may be available to you:

• Mortgage Add–On
  With our Mortgage Add-On option you can borrow up to 80% of the appraised value of your home, minus the remaining mortgage balance³⁴.
• RBC Homeline Plan^®
  If you have 20% or more equity in your home² the RBC Homeline Plan is a smart and easy way to manage all your borrowing needs under one simple, flexible plan.
• Secured Line of Credit
  You can fully secure a Royal Credit Line^® with a registered collateral mortgage on your principal residence. With a secured credit line, we can offer you a lower interest rate than we could with a regular, unsecured line of credit³.

You are on: Renegotiating a Fixed Rate Closed Mortgage

Renegotiating a Fixed Rate Closed Mortgage

Thinking about renegotiating your current fixed rate mortgage to take advantage of lower interest rates? Before you do, there are several things to keep in mind—the most important one being whether or not you will have to pay the mortgage pre-payment charge.

What is a Mortgage Pre–payment Charge?

In order to lend you money at a fixed rate for a set period of time, Royal Bank of Canada borrowed the funds needed in the market and entered into a fixed term contract. When you break your mortgage term, the Bank is charged a breakage cost as that contract will not be fulfilled. Mortgage pre-payment charges are collected from you to partially offset the costs that Royal Bank of Canada is charged.

What's Right for You?

The best way to know whether you can still save money in the long run after paying the mortgage pre-payment charge is to visit your RBC branch and talk with us.

Our calculator, "Should I Break My Fixed Rate Mortgage?" can also help you determine how much it could cost to break your mortgage and what interest rate you would need to get in order to "break even."

To learn more about breaking your mortgage and mortgage pre-payment charges, see:

• Understanding Mortgage Pre-payment Charges
• Advice Video: Breaking Your Mortgage