While most Canadians spend a lot of time, and expend a lot of effort, in shopping for an initial mortgage, the same is generally not the case when looking at mortgage term renewals.
Navigating a mortgage renewal can be a pivotal financial moment, and as a seasoned mortgage agent, I’m here to offer some insightful tips to ensure you make the most informed decisions:
Start Early: Begin exploring your mortgage renewal options well in advance of your term expiry. Early planning allows you to assess market conditions and consider various lenders, ensuring you secure the most favorable terms.
Assess Your Goals: Take time to reassess your financial goals and circumstances. Whether you aim to pay off your mortgage faster, tap into home equity, or lower your monthly payments, understanding your objectives helps tailor your renewal strategy.
Shop Around: Don’t settle for the first offer. Explore a variety of lenders and mortgage products. Different financial institutions may provide distinct terms and conditions, and shopping around empowers you to find the best fit for your needs.
Review Your Credit: A healthy credit score plays a crucial role in securing favorable interest rates. Before renewing, check your credit report for inaccuracies and take steps to improve your score if necessary.
Negotiate Terms: Don’t be afraid to negotiate with your current lender or explore negotiations with potential new ones. Mortgage terms, rates, and fees are often negotiable, and proactive communication can lead to more favorable terms.
Understand Penalties: If you’re considering switching lenders before your term ends, be aware of potential prepayment penalties. A mortgage professional can help you evaluate whether the benefits outweigh the costs.