If you owe a balance at the end of your mortgage term, you will need to renew your mortgage for another term. and with that comes an opportunity to evaluate your mortgage and financial goals. You should be proactive and not just accept your current lender’s offer, which means that you should start shopping a few months before your mortgage maturity date arrives. Many lenders will allow you to start the early mortgage renewal process, without any prepayment penalties. Seeing what is on the market will allow you to negotiate better renewal terms.
Renew Your Mortgage With the Same Company, Or Not?
Mortgage renewals are one of the most forgotten overlooked mortgage decisions made by homeowners. If you are like many people, you’ll stay with your existing bank or initial mortgage lender because you believe it is too time consuming to shop around for a better rate, or, even think the offer from your existing bank is the best deal available…Not always true. Shopping around and comparing rates at renewal time is the key to a better deal, that’s the first step.
Negotiating a rate discount with the branch can often be a timely process and will often not lead to the best rate, and even if you manage to negotiate a better rate, it’s usually a maximum ceiling discount of 1%. If you have a lot of other investments and financial products with the bank, then that may possibly earn you an exception with the bank, but for the most part, there are no exceptions.
Why Stay With My Existing Mortgage Lender?
There are some reasons to stay with the same lender. Convenience is one, your existing bank or lender doesn’t have to qualify you again, so the renewal process is faster than if you were to switch to another company.
Another, and better reason to no change lender, is if your financial situation has worsened. If you are concerned that a new lender would not approve the loan, or you might not pass a mortgage stress test…Then it makes sense to renew with your current lender as it is the safest option, since you would not need to pass the federal mortgage stress test. The downside is that you might be stuck with a higher mortgage rate.
Personalized Attention
All of our clients get the same personalized attention to finding the best mortgage solution for their needs. Everyone’s situation is different, and knowing this is very crucial when it comes to providing the service and rates that you deserve. When your mortgage is nearing renewal (ie: mortgage term is ending) remember these two significant opportunities to save money:
- Don’t wait for the bank! Approach your mortgage lending institution months before the renewal date and ask what they can do for you.
- Negotiate! Talk to your mortgage provider and see what their best rate on your renewal can be…Call them multiple times if needed!
- Call us and we’ll beat that rate, and at NO cost to you.