If you have a mortgage, chances are you’ll be doing a mortgage renewal when your current term has finished.
While most Canadians spend a lot of time, and a lot of effort, in shopping for an initial mortgage; the same is commonly not the case when looking at mortgage renewals.
Mortgages are amortized (over a set term) which can vary from 1-30 years and the longer the amortization the lower the monthly mortgage payment.
About 6 months before the end of your term, your current lender will want to retain your mortgage business by trying to entice you with early renewal offers. Beware – they don’t usually offer the lowest mortgage rate with their mortgage renewal offer. The usually offer between a one and a five year term and hope that you will be loyal, sign the form and send back to them.
You have 3 options:
- Sign and send it back as is (Don’t do this!)
- Check the market to make sure you ARE getting the best rate and renegotiate with your current lender
- Talk to a Sunlite Mortgage Agent and together discuss the best mortgage options available for your situation.
Lenders know that 80% of people will sign their renewal forms because it’s easy and most people aren’t informed. Banks & Lenders are businesses and therefore they want to make the highest profits to keep everyone happy.
Be an informed consumer and take the time you need to ensure you are being offered the best possible rate & terms you can get.
Yes, signing the renewal document is easy, however, it’s in your best interest to take a more proactive approach. Money in the lenders pocket comes directly out of your pocket… so it’s time to be informed and get to work!
5 Steps to Save you Money on your Mortgage Renewal:
- Receive the renewal offer from your current mortgage lender and examine immediately, this gives you enough time to make an informed decision.
- Do your research to find out about current rates.
- Speak to your current lender and negotiate if you want a better rate or terms!
- If your lender will not offer you a better rate then it’s time to move your mortgage. YES, you will have to complete a mortgage application and gather documentation.
- Look at your budget and see if you can increase the amount of your mortgage payments above the mandatory payments and save money by paying off your mortgage quicker.
Your mortgage is one of your biggest expenses. For this reason, it is so important to find the best interest rates and mortgage terms you possibly can. Contact a Sunlite Mortgage Agent to help find the best option for you!
There is a lot to discuss mortgage renewals