Weighted Average Cost of Capital

For those of you who are analytical thinkers, we’ve got a good one for you this week! This is the episode where we show you how Cannect, as a brokerage, lender, and investment fund, can maximize value and savings for you all at once. The weighted-average cost of capital (WACC) is the net, overall rate that a borrower pays to service all of their debt. Many people come to us in messy situations with multiple existing debts. The first thing we do is calculate their WACC. By refinancing and restructuring their debt, whether it be through a 1st mortgage refinance, a new home equity loan, or a mix of both, our goal is to get the borrower in a position where they are paying less money to service their debt annually than they were before. This may sound complicated, but have a listen to the episode where we describe this further and take you through real examples of improved financial situations where we helped people reduce annual debt payments.

A lot of people don’t see this as something they can do because of costs associated with breaking their debt agreement. Yes, these costs can be high at times, and sometimes just not worth it. We can apply the cost of breaking the debt agreement into your new debt servicing charges and see if it can save you money in the long term.

I’m sure many of you have also heard the saying “Time is Money”. That couldn’t be more true here. When analyzing an individual’s debt servicing situation, we account for not only its cost, but also the time it will take to pay the debt back. Can we get you into a situation to pay a certain debt faster, or do you see yourself being able to pay off a debt in the near future? These are additional factors that make every WACC and debt servicing solution unique.

If you didn’t even make it through 5 minutes of the episode, we get it. These situations are all complicated, stressful, and boring at times. These are the problems we find solutions to so you don’t have to. We will determine the best course of action to improve your debt servicing costs and overall financial position. 

Just give us a call, we’d be happy to help you just as we did in this episode.

#WACC #MortgageRates #InterestRates #Cannect #Investing