Mortgage Renewal

Main Street Mortgages

If you’ve received a mortgage renewal letter in the mail, you should review your options before signing and sending it back to your lender.

Improved Rate with Early Rate Hold

When considering mortgage renewal, it is important to compare the interest rates offered by your current provider with those available through brokers. Our experience shows that broker rates are often better than renewal rates. Even if you decide to stay with your current financial institution, a mortgage broker can negotiate a lower rate for you.

In addition, our associates can secure a rate hold for up to 180 days before your mortgage renewal. To illustrate the potential savings, consider two clients with a $275,000 mortgage and a renewal date of August 1, 2022. Client A requested a rate hold after being reminded six months before renewal and was able to secure a no fee switch with a 120-day rate hold at 3.89%. Client B, on the other hand, waited for the bank’s renewal notice, which was sent only 20 days before renewal.

Banks often try to renew their clients at higher rates than their current best rates since most clients don’t realize they should have a brokerage securing those best rates. Unfortunately, by the time Client B received the notice, over three months after Client A, rates had increased by half a percent. As a result, Client B paid an extra $8,000 over the next five years compared to Client A, who had an experienced professional securing the best rate on their behalf.

Accessing Additional Funds

When considering taking advantage of the equity in your home, it’s important to assess whether there will be any payout penalties with your current mortgage provider. Utilizing this equity can have several benefits such as:

Amortization or Payment Adjustment

It’s possible that your financial situation has changed since you first took out your mortgage. For instance, you may have received a raise and would like to increase your amortization and monthly payments to reduce the amount of interest paid over time. Conversely, if you have taken on new financial responsibilities, opting for an increased amortization could provide some much-needed financial flexibility.