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Your term is up, this time save more money!
When it comes to renewing, choosing the right mortgage (and mortgage agent!) can save you thousands of dollars. If your mortgage is up for renewal, your lender is betting that you won’t comparison shop. If you don’t believe me, compare the rate in your renewal letter with the going rates in the market and don’t take it personally if the rate they try and offer you is much higher than what’s available elsewhere. This is just another example of how your bank is looking out for their own interests, and trying to make as much money off of you as they can. They should be ashamed as they do it to all their customers.
SWITCHING / RENEWING:
Did You Know?…There are absolutely no costs to transfer your mortgage from one Banking Institution to another. No appraisal fees, no legal work and no penalties. Yet still, mortgage renewals are one of the most neglected decisions made during the life of a mortgage. Many homeowners stay with their existing mortgage lender because they believe it is too time consuming to shop around for a better rate. Or, they may think the offer from their existing bank is the best deal available. This is not true
Banks tend to make the majority of their profits from mortgages on a client’s renewal rather than when they first attract the client with the initial offer. Keep in mind that your mortgage is more or less a commodity that each lender would love to compete for. Don’t settle for the first offer your lender provides you with. Shop it around.
Our dedicated team of professionals can assist you with this process. With access to over 20 lenders (from the likes of Scotia, TD and National Bank to the wholesale channels like ING, Firstline and MCAP) we will shop your mortgage around until we find the best rate, term and product.
When the mortgage is about to mature, most lenders will mail out their renewal agreements around 30 days before the mortgage matures. Often, this causes a lot of grief for many people, especially if rates start to climb just before the mortgage comes due.
We can guarantee your rates up to 180 days (6 months) before your mortgage comes due, and this service is free and with no obligations. Just this protection could and has saved thousands of dollars for our clients. Let’s get it working for you, too.
When your mortgage is due for renewal, it’s a great opportunity to make sure that you’ve got the right mortgage for your present needs. Since the mortgage is fully open at this time, this is the perfect opportunity to pay down your mortgage. Whatever you can afford, even a small amount, will have a significant impact in terms of interest you will save over the life of the mortgage. It is also a great opportunity at this time to consider a more frequent payment method, such as bi-weekly or weekly, if you are not already doing it. And of course, choosing the new term is important.
Another step you can take to save thousands of dollars in interest is if at renewal the rates are lower than the rate you just had, and you are comfortable with making those payments, keep the payments the same at the lower rate and start planning for the mortgage-burning party.
Whether or not you should early-renew your mortgage depends on several factors. If the current rates are lower than the rate you have, compare the prepayment charge against the savings by having the lower rate, and this will point the way. Or, if you believe that interest rates will be higher at your existing renewal date, you can renew early to protect yourself from higher rates.
One thing to remember if you decide to early renew, is the prepayment charge will have to be paid up front. If there is room, you can add it to your mortgage, but you will have to go through a lawyer to redo the mortgage, and this cost will have to be taken into consideration when deciding which way to go. Some financial institutions will blend both rates for the new term.
Remember that we have the CASH-BACK programs that could pay for your prepayment charge. The savings in some situations run into the thousands of dollars.
Re-examine your mortgage from time to time, and at least once a year. There are thousands of dollars that could be saved in many situations, but they go unnoticed.
If you are within 6 months of your renewal date, then take the time to apply with our office. If your mortgage isn’t coming up for renewal in the next 6 months, then take advantage of our proprietary Mortgage Tracking System, by clicking here. This software alerts us up to six months in advance that you have a mortgage coming up for renewal and of any refinance opportunities which may increase your net worth or put you in a positive cash flow position.
At F1RST CHO1CE Mortgage Solutions we’re passionate about sharing our knowledge, experience and unbiased opinions with homeowners that are looking for a trusted advisor to help them with their renewal financing.
ANY QUESTIONS?…Contact a Mortgage Advisor today!