Is Your Mortgage Coming Up for Renewal?
With your mortgage renewal fast approaching, you've reached an important financial milestone--congratulations. You've worked your way through your mortgage term, your home has probably grown in value, and you can feel good about making progress in your mortgage years.
Lenders send out renewal forms just prior to renewal dates to those with good payment histories and about 70% of homeowners sign on the dotted line without asking any questions. In today's hectic world, may seem like the easiest thing to do, but you should stop and ask yourself some important questions first. There's an opportunity here, don't miss it. Maybe your mortgage needs have changed. This is the time to decide. For instance, is now the right time to tap your home equity for a renovation project? Or maybe you're considering a cottage or vacation property. You should also take a look at your other debts; many Canadian homeowners have taken advantage of historically low rates to roll other higher-interest debts into their mortgage.
Are you confident you will get the best rate at renewal? Having multiple lenders compete for your business is a great way to ensure you get the best rate for your situation. A Mortgage Broker deals with many different lending institutions, including major banks, credit unions, trusts and other national and regional lenders. They can use their significant negotiating power to find the best mortgage to fit your specific situation.
Of course there are some administrative details when switching your mortgage to another lender, but don't let this discourage you. It doesn't cost anything to investigate your options. If you renew with your lender, you are extending your existing mortgage at current rates and terms. If you switch your mortgage to a new lender, you will go through an approval process similar to when you took out the original mortgage. You can either assign your existing mortgage to a new lender or you can apply for a new one should you want to borrow a larger amount to consolidate debt.
What will it cost you? Your lender may charge a discharge fee, and you may need to pay legal and appraisal fees if you are getting a completely new mortgage instead of switching your existing one. Be sure then to assess if the money you will save by switching to a better interest rate offsets that cost. It's possible that you could also pay more for mortgage life insurance because your new premiums will be based on your current age.
If you're interested in examining your renewal options, it's a good idea to contact a Mortgage Broker about four months prior to your renewal date to complete an application. Once approved, your rate will be guaranteed for up to 120 days, depending on the lender, although you'll get the lower rate should rates drop prior to funding. While our Brokers can save you money by finding the best mortgage available, you don't pay for their service (on approved credit). Instead, the lender selected pays compensation for the services and solution provided. And since a Mortgage Broker's business is built primarily through referrals from satisfied customers, you can be guaranteed a positive "renewal" experience.
Find a Mortgage Broker
Back to top