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.
By omitting proper consideration at the time of renewal, this practice costs Canadian citizens thousands of extra dollars every year. Nearly 60% of borrowers simply sign and send back the renewal that is first offered to them by their lender without ever shopping around for a more favorable interest rate.
Homeowners should never accept the first rate-offer from their existing lender. Without any negotiation, simply signing up for the market rate on a renewal is unnecessarily costing the homeowner a lot of money on their mortgage.
Generally, it is a good idea to start shopping for a new term between four and six months before your current mortgage term expires. Many lenders send out your renewal letter very close to the time that your term expires and this does not give you ample time to arrange for a mortgage term through a different lender. This means that you need to be tracking your own mortgage term timeframe and know when it is time to start shopping for a good mortgage renewal rate.
Before you ever hear from your lender about renewing your mortgage term, have a licensed mortgage professional shop around for you, you will be amazed at what they can accomplish on your behalf!
Your mortgage is one of your biggest expenses. For this reason, it is imperative to find the best interest rates and mortgage terms you possibly can. By shopping around at renewal time you can save substantial amounts of money over the life of your mortgage loan. Don’t be one of the 60% who just simply sign their renewal letter and send it back. Use the services of a licensed Dominion Lending Centres mortgage professional to ensure the lenders compete for your business.
Mortgage Renewal Steps:
Step 1: Speak with us about your plan and what options are available
Step 2: Submit your application including submitting all documents required (See Mortgage Docs Checklist)
Step 3: Order payout statement and an appraisal from the current lender (if applicable)
Step 4: Once your mortgage is approved, complete all outstanding conditions ASAP
Step 5: Contact a home insurance company to change home insurance to match your new lender. Tip: combining home & auto may qualify you for discounts. (See NUERA discount link for a free online quote on home insurance)
Step 6: Finalize mortgage details based on appraisal adjustment and payout statement from your current lender (if applicable).
Step 7: Once your mortgage is final approved, sign the title and legal documents and pay any shortfalls and/or fees with your lawyer or an FCT agent.
Step 8: On the renewal/funding date, all funds will be advanced, and the mortgage transaction will complete.