Don’t get caught with a higher interest rate on your renewal !
Almost half of homeowners sleepwalk
through their mortgage renewal
Given the large financial commitment of a mortgage, it’s surprising that 44 per cent of Canadian homeowners either just accept whatever their lender offers at renewal, or don’t even remember how they renewed!
It’s tempting to just sleepwalk through the mortgage renewal process. But if you’re not doing even the slightest comparison shopping or negotiating, then you’re missing out on an opportunity to save thousands on your mortgage. When your lender sends you a letter saying it’s time to renew… what that really means is that it’s time to get advice. Professional, independent advice.
Get an expert second opinion on what you’re being offered. We’ll take a look, and compare it to what we can find out there as an alternative among the 50 or more lenders we have access to.
* A recent CAAMP/Maritz survey found that only 56% of renewers negotiated, 44% took the mortgage rate originally offered by their lender (39%) or just didn’t know how they renewed (5%)
Renewal is also a good time to decide whether you should consider a fixed or variable rate mortgage, increase or decrease your payments, or take advantage of prepayment privileges to pay your mortgage off faster.
When 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 or you can apply for a new one should you want to borrow a larger amount.
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. You won’t have to pay for your mortgage broker’s service (oac) because the lender selected pays compensation for the services and mortgage solution provided to you.
Bring your renewal notice to your mortgage broker six months prior to your renewal date. Many lenders provide a 120-day rate guarantee for pre-approved clients to protect them against a rise in mortgage rates.
Got a mortgage renewal coming up in the next six months? Let’s start talking!