The final days of fall are upon us! Here, we provide our end of autumn market update to see where things stand here in Halifax.
The Canadian Emergency Business Account, or CEBA, loans are approaching their repayment deadline for those who hope to access partial loan forgiveness. While most small business owners would like to secure this forgiveness, some are struggling to find a way to do it. If you are a home owner, it might be time to consider using your home as part of the solution. Here’s how a refinance may help you during this period!
What is the CEBA?
The CEBA was created during the COVID-19 pandemic. It was meant to provide assistance to small businesses that had to shut down or reduce business operations. Businesses could secure a loan of up to $60,000. Of that, $20,000 would be forgiven if the rest of the loan was repaid on time. The current deadline to make that repayment is January 18, 2024.
This partial loan forgiveness incentive could give many small businesses a huge boost. However, many people are struggling to make the necessary repayments in time to qualify. So, if you fall into this category, what are your options?
The benefit of refinancing
If you are a home owner, one solution could be to refinance your mortgage and take advantage of your existing equity. Depending on how much equity you have built up in your property, this might provide a big lift. You can use this cash flow to help make your CEBA loan payments on time for the deadline to secure that loan forgiveness. Those who choose to refinance also have an extended deadline to qualify. You would have until March 28 to complete the process and access the forgivable portion of your loan.
This may also be a good time to consider debt consolidation if necessary. If you have other existing debts, consolidating them into one payment likely means securing a lower interest rate. With a lower rate, you will have some extra financial room to make repayments with money that would otherwise have been spent on interest. Remember, you are still paying off all your debts. The difference is you are doing it as a lump sum, instead of several individual payments. Plus, you can likely benefit from a lower interest rate.
Reach out to a broker
Using a mortgage broker is essential during this period. The CEBA loans were introduced very quickly and urgently, and businesses are facing repayment deadlines for the first time. If you have any thoughts about using your home to help make these repayments, be sure to contact a mortgage professional first! This could be a great option for many home owners, but as brokers we can ensure it’s the right move for you. Plus, we will be there for you from start to finish, so you can feel confident in your decisions and financial situation.
You don’t need to face these loan repayments alone. If you have any questions about your mortgage, get in touch with us at Clinton Wilkins Mortgage Team! You can call us at (902) 482-2770 or contact us here.