The average mortgage comes up for renewal every five years. And, as you know, a lot can happen over a five-year period. That’s why it’s important to look at your needs and goals every time your mortgage is set to renew to ensure you negotiate the mortgage product and rate that best suits your unique situation.
Your mortgage agent will gladly review everything with you to ensure you’re always in the right mortgage, including going over the following details.
Determine your needs and goals
You want to ensure you examine all of your mortgage options every time your renewal is approaching. Some important considerations include selecting a fixed vs variable mortgage rate, the length of time you plan to stay in your current home, which will help you decide on the best term length, and if it’s beneficial to access some of your home equity while you’re renewing to make some home renovations, send your kids to school, consolidate debt, buy an investment property and so on. Tapping into your home equity at renewal is ideal because you won’t have to pay a penalty to adjust your mortgage mid-term.
Start the renewal process early
It’s ideal to begin looking at your options in advance, since you can renew your mortgage up to four months before your contract date expires without paying a penalty – regardless of whether you choose to stay with your current lender or move to a new one that’s offering you better options. Planning ahead will help ensure you have adequate time to weigh your renewal choices.
While your existing lender is required to send you a renewal notice at least 21 days before your current mortgage is set to expire, most lenders send them much sooner and often offer the option for early mortgage renewal up to 120 days before your term must renew. It’s important to be aware, however, that the renewal offer your lender sends isn’t always the best for you.
Be open to change
Staying with the same lender doesn’t mean you’ll end up with the best mortgage. Your mortgage agent will review all your options to ensure you’re matched with the most ideal mortgage available today. Sometimes this means switching lenders.
When you renew your mortgage, you’re actually negotiating a new mortgage, which means you should look at the term, features and rate just like you did when you secured your original mortgage to make sure you can save the most amount of money.
Have questions about renewing your mortgage? Answers are a call or email away!