• My mortgage is renewing what do I do?

    April 9, 2020
  • mortgage is renewingMy mortgage is renewing what do I do?

    If your mortgage is renewing, the first question that we will ask you is: when?

    The reason we are asking you when your mortgage is renewing, is because we can only renegotiate your mortgage within a period of 120 days from the maturity date. Often, your existing bank will try to convince you to renew your mortgage prior to the maturity date and sometimes even prior to the 120 days. This is their effort to lock you in. It is almost never advisable to renew early because you are better off becoming a free agent normally.

    The Magic Number Is 120 Days

    If your mortgage is renewing within 120 days, then as a mortgage broker, we can shop around to different lenders who will try to bid for your business and provide you with a rate that you can switch to at maturity. In other words, let’s say that it is June and your mortgage is renewing in October. We can negotiate a rate with a new lender that you can switch to in October. In fact, you can do so without even committing to the new mortgage. We just hold the mortgage rate and if the rates go down in the meantime, we get the better mortgage rate. If the rates go up, we get the one that we held. However, there is not a lot that we can do if we are not within the 120 day period.

    So the moral of the story is: when your mortgage is renewing, you should call a broker that you trust. Try to get the best rates on the market at that time, and then just wait. As the maturity date approaches, we can continuously reevaluate.

    Path Of Least Resistance

    The other point that you should consider is that before switching to a new lender when your mortgage is renewing, you should try to find out the best rate that your existing lender will offer you. When you have that information, you can call us and we will tell you if you are being treated fairly or not. If they are treating you fairly, it is usually in your best interest to stay with them when your mortgage is renewing. In order to switch lenders you will need to provide a complete new application and documents to prove you’re income etc. Furthermore, if your current circumstances are such that you may not qualify, it is better to just sign and continue no questions asked. In other words, if your mortgage is renewing it is less hassle for you to remain with your existing lender unless you are refinancing or they are not treating you fairly. If you are refinancing you need to re-qualify anyway. If they are not treating you fairly, then you should probably cut them loose!

    Sean Howard is a Mortgage Broker. His office is located at 651 Fennell Avenue East in Hamilton, Ontario. If you would like to speak with Sean, he can be reached at 905-574-9200 #216. Alternatively, you can contact Sean here.

    If you would like to apply for a mortgage online, please follow this link.

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    For more information on this topic, check out this article: https://www.robertfloris.com/mortgage-renewals-get-educated/


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