5 Tips for Mortgage Renewal Time

Mortgage loans are renewable at the end of each term especially when the amortization period has not yet completed. In Canada, you are not allowed to get a loan that has a period longer than 10 years, although a lot of mortgages have an amortization from 20 up to 30 years. When you hit the end of your term, but still have a mortgage balance, you will need to renew your mortgage for at least another year.

Renewal of mortgage is essentially a method of which your current term comes to an end and you sign a new one – hoping to get a lower mortgage rate. The Mortgage Renewal Ontario helps protect both the lender and the consumer. For lenders, it prohibits them from committing to a fixed interest rate for a few decades. Meanwhile, consumers acquire an opportunity to adjust the loan terms which they are not satisfied with and cannot stand it for the whole period of amortization.

So, if you’re thinking about renewing your mortgage loan, then it will give you a chance to assess your financial situation. To get the best rates, here are five tips for mortgage renewal:

Review Your Current Financial Goals

A lot can happen over the course of your current mortgage term. Probably, your financial goals at the start of your mortgage period may not exactly be the same as your goals in the present. You may have had allocated budget for your other needs. Whatever that is, always make sure to review your current financial goals before choosing a mortgage rate, product and period. Also, ensure that your current lender can deliver a mortgage plan that fits your needs. For instance, if you have a five-year fixed rate of mortgage, then your slip for renewal is likely to be extended for another five years. Thus, assess carefully your decisions before agreeing to the mortgage terms and conditions. 

Some financial goals ponder about how the extra money may affect your mortgage prepayment options. The choice between the Home Equity Line of Credit (HELO) to access equity and the refinancing of the mortgage are other financial goals to be weighed in. Both of these choices will help you select the lender and the commodity according to the financial needs suitable for you.

Shop around early

How fast can you renew a mortgage? This question probably gives you a hard time to decide but the faster you renew the better. Just like what most people say, the early bird catches the worm. Thus, start shopping as early as possible before your mortgage term ends. You don’t have to stay with the same lender though. You may choose to renew your mortgage to a different lender if you think the latter offers better terms and conditions.

But if you are willing to negotiate with your current lender once they give you the renewal letter, then, start doing your research about market rates. Also, try comparing lenders about which one offers a better opportunity. Who knows, you would land with a new mortgage term that suits your needs.

Look for a Better Mortgage Rate

The maturity date for your mortgage term is the exact day it finishes. With most lenders, you will be able to start an early mortgage renewal phase up to 120 days (4 months) from the end of your contract. As soon as you are 120 days from the end of your term, it is advised that you start looking for a better mortgage rate. You will see what the prices are by beginning to shop around as soon as possible. You may land a secured deal with a much better rate for the next five years. If you find one, then be ready to negotiate with your lender.

Other people are too afraid to try negotiating with lenders. But, there’s nothing to be afraid of. You can always seek for a better mortgage rate. Being able to get the best mortgage rate is one of the most common reasons why people are switching providers during mortgage renewal time.

Consider Getting a Mortgage Broker

When you are looking for a better mortgage rate, it’s a smart idea to get a mortgage broker. Instead of having to go from lender to lender including Private Commercial Mortgage Lenders Canada, a mortgage broker will help pull your credit report and look for a list of lenders who are willing to work with you and give you the best rates. This will send you a curated list of the rates that you would be qualified to apply for so that you can select the best choice for you. Your mortgage broker should be a licensed professional and a reputable expert in their profession, with proven credentials and references. Their established reputation is the cornerstone of their service, and their performance is reflected in your satisfaction.

Give Yourself Time to Switch Lender

When you are looking for a better mortgage rate, it’s a smart idea to get a mortgage broker. Instead of having to go from lender to lender including Private Commercial Mortgage Lenders Canada, a mortgage broker will help pull your credit report and look for a list of lenders who are willing to work with you and give you the best rates. This will send you a curated list of the rates that you would be qualified to apply for so that you can select the best choice for you. Your mortgage broker should be a licensed professional and a reputable expert in their profession, with proven credentials and references. Their established reputation is the cornerstone of their service, and their performance is reflected in your satisfaction.

Give Yourself Time to Switch Lender

If you want to switch lenders, do it as soon as possible. You will be asked to apply for a mortgage as if you’re applying for a new one. Thus, you will provide the paperwork such as:

  • Your copy of mortgage renewal letter
  • Proof of income
  • Proof of home ownership
  • Proof of your property insurance

Once you’ve submitted the needed requirements, your application is set to be processed by a mortgage broker. Typically, it takes more than a week, so make sure that you leave a lot of leeway between when you begin the process and when your mortgage is due to be renewed. Otherwise, you will end up sticking to the same mortgage lender for your new mortgage term.

Where to seek financial advice for your mortgage renewal?

 If you are looking for the best advisor for your private mortgage renewal, then you’ve come in the right place. Private Mortgage Canada is team composed of expert brokers in the field. So, we can effectively assist you with your financial concerns. A lot of clients have gotten our service especially when they are looking for a Private Mortgage in Toronto. We always make sure of the quality service we offer to give you the greatest assistance you need. 

      If you want to set an appointment with, you may email us through [email protected] or contact us through our contact number +1 416-825-0142. We can’t wait to have you on board!

Leave A Comment