When it is time to renew a mortgage the majority of Canadians make a huge mistake. More than 70-percent of homeowners don't bother to shop around or research the market to see if they can get a better deal. Instead most people just renew their mortgage and either assume the rate they are getting is the best available, or they just take their lender's word for it. In many cases signing to renew without checking out other options first ends up costing consumers thousands of dollars.
The truth is your lender might actually be bluffing when they tell you the rate you're getting on your renewal is the best you can get.
Switching to another lender could save you a lot of money.
Mortgage Renewal Options
Before signing it is always wise to assess your mortgage renewal agreement. Consulting a mortgage broker can also be helpful. Having an expert assess your agreement can provide valuable insight and can help you determine if the time is right to make a move to a new lender.
You should be aware that you are legally entitled to make a mortgage switch during your mortgage renewal period, and when you follow the rules laid out in your agreement there are usually no financial penalties.
The regulations governing mortgage renewals vary from province to province in Canada, so it is vital that you have a clear understanding of the rules before proceeding. A mortgage broker can help you survey the market, compare rates, and can explain the regulations to you and can help you come up with the best plan of action.
Mortgage Switching Costs
Some of the costs involved in switching a mortgage to a new lender can include:
- An appraisal fee Before approving a mortgage lenders always require an appraisal of the property. The fee for this can range from $150 to $300.
- A discharge statement fee
- A $150 to $300 discharge fee will be charged by your current lender, if you choose to switch before your mortgage renewal period.
- Legal fees
- Legal Lawyers will need to be involved int the process to make sure the mortgage change is handled properly. Council is needed to register a new mortgage. The cost can range from $600 to $1500.
It may seem like the fees associated with switching a mortgage are substantial, but there is no need to worry. If it's worth switching your savings will more than offset the fees, and because the mortgage market is competitive, many mortgage lenders will actually cover most or in some cases all of the fees in order to earn your business.
Avoid Hasty Mortgage Renewal Decisions
At FamilyLending.ca we are focused on service, and a big part of that service is providing information in person and online. The information we provide helps people make informed decisions about mortgage renewals. You don't need to assess your situation alone. We are here to help you and to go to work for you if you decide the time is right to switch your mortgage to a new lender.
FamilyLending.ca is connected a large network of mortgage lenders, and our team of experts has the knowledge and tools to find the right match for you. We want to help you find the best mortgage for your needs.
If your mortgage is due for renewal and you think the time might be right to switch to a new lender, contact FamilyLending.ca to lower your mortgage rates today.