A refinancing option where your lender combines your existing mortgage rate with the current market rate to create a new blended rate, rather than breaking your mortgage and paying a penalty. The blended rate falls somewhere between your old rate and the new one. This option is typically offered by the same lender and is used to access equity or increase the mortgage amount mid-term.
Why It Matters
A blended rate can be a smart way to access equity or increase your mortgage without paying a full breakage penalty. It's particularly useful if you have a favourable existing rate and need additional funds. However, compare the blended rate carefully against the cost of simply breaking the mortgage and starting fresh.
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