When your mortgage comes up for renewal this will usually have most banks licking their chops. Your bank will send you your renewal letter asking you to pick your new term sign it and return it. Sounds Easy, and it is. What most banks are doing is sending their posted rates (the highest rates) and hoping you will sign it and send it back to them. And do you know what, Some people do! It’s easy and most people think their bank is always looking out for your best interest. It’s all about profits to banks.
If your mortgage is coming up for renewal, you should usually start preparing for this about 4 months before it happening. Most lenders will offer a 120 day rate hold for you to make sure that you are receiving the best rate on the market. If the rates go down in that time, yours will go down. If the rates increase, you are protected with the rate that is being held for you.
What if the best rate is not at the bank you are currently at? If you are thinking of doing a switch and not looking for any extra equity funds, the bank will pay for your legal fees and appraisal (if needed) to switch the mortgage over to them. All that you would have to show them is that you are working and able to make the payments.
What if I want to consolidate some debt? If you have other debt that you are thinking of consolidating, a mortgage renewal is the perfect time to do it. You do not have to worry about pre-payment penalties, or blending rates. Again there are lenders out there that will pick up the legal fees to add this debt on your current mortgage, as well as sometimes pick up all or part of the appraisal (if it is required).
So if you have a mortgage that is coming up for renewal, talk to a Mortgage Broker like myself, we will help you get the best rate even if it is still with your same bank. We will also help you make sure that you have the best product that fits YOUR needs.
Don’t be one of the people who is paying close to 2% more than they have to.
Don’t just get a mortgage, KNOW your mortgage.
Email me firstname.lastname@example.org with any questions.
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Scott Bourke, AMP
Dominion Lending Centres Regional Mortgage Group
866/403-343-1125 Phone 403-343-1126 Fax