Mortgage and Debt Structuring

With interest rates at historic lows, many financial experts argue that having some debt today isn’t necessarily a bad thing. For instance, if your debt carries an interest rate of around 3%, it may not make sense to pull money from investments earning 6% or more just to pay it off. You’d essentially lose the higher return in favor of paying down a relatively low-cost loan.

This concept relates to something banks use every day: arbitrage. Arbitrage is the practice of taking advantage of price or interest rate differences between two or more markets.

Let’s break it down with a simple example. Suppose you deposit $100,000 into a bank account, and the bank offers you 0.5% interest. The bank then takes your money and lends it out to other customers at a higher rate—say, 4%. While you earn 0.5%, the bank earns the 3.5% difference. That’s arbitrage in action.

The idea here is that you can potentially create your own arbitrage. By restructuring high-interest debt—like credit cards, student loans, or other personal loans—into lower-interest options, you free up cash flow and improve your overall financial efficiency.

For example (and this is not a recommendation), some individuals refinance their homes or businesses at very low interest rates, then invest that borrowed money into opportunities that earn more than the interest they’re paying. While this strategy carries risk, it’s one way people attempt to leverage low-cost debt for higher returns.

A friend of mine, who happens to be a successful financial advisor, did something bold. On his own decision, he pulled $10 million in equity from one of his properties and took out a loan at 3%. He then invested that $10 million into the stock market. Again, I’m not suggesting you do the same—but this is a real-world example of how some use arbitrage as part of their financial strategy.

Reorganizing your finances and paying attention to your debt at the current time could prove to be a big benefit for you.  Many times we are so busy putting our head down and being focused on whatever it might be while missing big opportunities. This is one area you do not want to overlook.

With years of experience dealing with mortgage and debt restructuring, together with our transparent and friendly approach to financial management, we are confident of identifying a debt restructuring solution that is right for you. Our aim to give you peace of mind by creating a mortgage and debt restructuring strategy that enables you to protect your financial future.