Mortgage Renewal – Understand Your Options Before Signing The Offer
Exploring your mortgage renewal options could save you thousands!
Mortgage renewal times are based on the term that was initially set when you obtained your mortgage. Terms can run anywhere from 1-10 years, the most common at 5 years.
If at the end of your term you still have a remaining balance, then it’s time to look at your options for the next term.
It is important to understand the process, and your options, so you are prepared to sign your mortgage renewal with no lingering questions or doubts.
The Process
We take the mortgage renewal process just as serious as when you initially secured a mortgage. Our goal is to make contact with our existing clients approximately 6 months out.
Five years is a lot of time for life changes, this is the perfect time to review your financial situation as well as any new goals you have established.
For instance, has your employment changed? Is there a new baby is on the way? Is retirement approaching? Are you thinking of moving to your forever home, downsizing, or looking at purchasing that second home on the lake?
Have you considered mortgage refinancing? Now is also the perfect time to investigate this further, as there are no early payout penalties, if you refinance at mortgage renewal.
Any way you look at it, flexibility is important and mortgage renewal time is a great opportunity to investigate your options, and make adjustments.
What You Need To Know
Another advantage of starting the process early is the 120 day rate hold. This is great news, especially if rates are on the rise. We’ll review you rate before the new term starts and if rates have dropped we’ll secure the best rate available.
Finding the best mortgage with the best rate may mean switching lenders. After reviewing your current situation we’ll let you know which option looks best.
Keep your eyes open for a mortgage renewal offer from your current lender. You can expect to see this a few months before your mortgage renewal date.
A word of caution, these offers are sometimes presented at the posted rate, which is not necessarily the best rate available. Don’t feel trapped into signing without investigating.
What’s it going to cost?
If the decision has been made to move the mortgage to a new lender you’ll be please to know there is no penalty to move at renewal time. There may be some costs associated, however as each situation is different, we’ll talk costs on individual basis. We do our best to keep these at a minimum or zero.
Next Steps
If your mortgage renewal date is approaching, you are one of our valued clients, and your contact information remains the same, we will be in touch to get the ball rolling. Our questions are similar to your original application, we’ll update your employment information, obtain your permission to run a credit check, ask for some standard paperwork (current tax statement, mortgage statement or renewal offer, and income documents). Additional documentation may be required depending on your individual situation.
Let Us Help
If you’re hearing about Canadian Mortgage Professionals for the first time, go ahead, reach out. We will walk you through the process, discuss your financial plans, and help you determine the best way to proceed. Give us a call, we’re happy to help.
