Mortgage Renewals – Don’t Make This Mistake.
Chilliwack, BC – While seemingly easy, your mortgage renewal could be the most overlooked process during the lifetime of your mortgage.
More often then not, mortgagor’s sign their renewal papers without thinking twice but what you don’t know is that you could also be handing over THOUSANDS of dollars. In fact, 2/3 Canadians sign directly with their existing lender.
I mean, why wouldn’t you sign with your current lender? They’ve kindly reminded you that your renewal is coming up, they already have your information and your mortgage was originally placed with them.
However, the “early lock in rate” offered through your existing lender is typically 0.4% – 0.7% higher than it would be if you shopped your options. On an average mortgage this day and age, that converts into a lot of dough and that’s money not even being paid towards your principle!
When buying a car, most of us do a fair bit of research. We look carefully into different makes, models, years; all in which are dependent on our lifestyles. From there, we go to a variety of dealerships to seek out the best bang for our buck. The same rules apply when it comes to your mortgage renewal.
Transferring your mortgage loan from one financial institution to another is one of the simplest mortgage transactions and if completed at the time of your renewal, you avoid having to pay fees or penalties.
Our advice? Don’t sign your mortgage renewal blindly. A mortgage for most of us is the single, largest investment we make in a lifetime and our team of experts understand this, therefore we offer complimentary renewal consultations. It’s our job to get you the best mortgage product and rate tailored to your lifestyle and financial goals.
What Happens to Your Mortgage if You Don’t Renew by Your Maturity Date
Lenders will often automatically roll your mortgage into an open term mortgage for the following 6 months at a much higher interest rate until you decide on a term or move to another lending institution. It’s recommended to get started on your mortgage renewal up to 4 months prior to your renewal date.