How to WIN the Best Mortgage Renewal Rate
For most Canadians, the home is one of the most significant investments they will ever make in their lives. If you’ve taken out a mortgage to buy your home, the chances are that the mortgage term will end at some point, and you’ll be required to renew it. The mortgage renewal process can be stressful, but it’s also an excellent opportunity to lower your mortgage rate and save a lot of money. In this blog post, we’ll provide you with some helpful tips that will help win the lowest possible mortgage renewal rate. Whether or not you have renewed before or this is your very first time here are the tricks to winning the lowest possible rate.
1. Start Early to access the best mortgage renewal rates
One of the best tips we can give you regarding mortgage renewal is to start early. Do not wait until the last minute to renew your mortgage. You should begin to shop around and compare mortgage rates at least SIX months before your renewal date. This will give you ample time to compare rates from different mortgage lenders and negotiate a lower interest rate and better terms. Do not feel pressured to renew your mortgage with your current lender if they are not offering you a competitive rate. Your existing lender will either send you notice well in advance, or they will simply contact you 30 days before. The reason they may contact you only 30 days before is that they know you do not have time to shop the marketplace. With this approach, they force your hand and creates stress to sign with them, regardless.
2. Shop Around – Let US do the work for you!
Do not assume that your current lender is always the best option for your mortgage renewal. We will contact different financial institutions who will offer us varying rates and terms. At renewal time, your existing lender wants to retain you and other lenders want your business. We will even help you negotiate with your existing lender.
3. Are you a Mortgage Renewal Orphan?
Did you work with someone else to arrange your mortgage, but they have not been in touch since? You may be a Mortgage Orphan. Rest assured, we have your back to manage the renewal process and will connect you with our experienced mortgage team. The mortgage representative need not be contacted, meaning we take control of navigating the next steps of your mortgage renewal.
4. How do I get the best rates that are advertised.
Canadian mortgage are sometimes mythical. Meaning, if you originally had less than 20% down payment when you first purchased your home, you are likely holding the Golden goose of mortgages. This means you paid a mortgage insurance premium to CMHC (or Sagen or Canada Guaranty) when you first purchased. IF there has been no material change to the account it is still an insured mortgage. A material change is defined as refinancing the original mortgage. Whether it be to add additional funds and/or reset the amortization from the original date. IF we have done either of those two it changes an originally insured mortgage, we lose the insurance coverage. This will affect the rate we will be offered at renewal time.
5. An EASY mortgage renewal
The easy approach to a mortgage renewal is a simple one. The fewer changes you make it renewal time the better. This means adding money, or resetting the amortization will likely cost more in terms of fees to move at renewal time. Your current Bank already knows this, which is why they offered you a HELOC line of credit at inception. If you no longer need the HELOC, then we can simply move the main mortgage without any costs. If you owe money on the HELOC, we can add exisiting debt to the new mortgage at the best possible rate. Again, likely with no fees to switch. However, if we from your bank for a better rate and keep the HELOC, it may cost us.
Renewing a mortgage may seem like a stressful process, but it doesn’t have to be. To get the best mortgage rate possible, we will start early, negotiate with your lender for your renewal rate. If the existing lender won’t give us the best rate, we will go elsewhere, it’s that simple. By following these guide, we will make you a renewal expert and take away the mortgage stress!
Bottom line, at renewal time you are in charge. The mortgage account is considered open and we are free to leave at any time. However, lenders love to retain their clients, but they also need to provide best rates. Let us navigate this entire process for you. If your mortgage account is coming due for renewal within the next six months. Call us today.