Renewals/Switchers

In 2015 the Canada Mortgage and Housing Corporation (CMHC) found that 86% of people stayed with their existing lender when the time came to renew their mortgages. Often it is most convenient for homeowners to just sign the renewal offer from their mortgage lender and get on with it. But a Bank of Canada study showed that many banks and lenders may not offer the best deals to existing customers. They are counting on this captive audience and do not necessarily feel the need to compete with alternate lenders offering more favourable rates. Securing a mortgage with lower fees can result in significant savings. But choosing a new lender is not always the best option either. Switching lenders while you still have a balance owing on your home could mean prepayment penalties and administrative and legal fees. How can you figure out which option will leave you in a stronger financial position?

Choosing the right partner to help you navigate the renewal process, means choosing a broker who will educate you on the options available to you and confidently negotiate with lenders (existing or new) on your behalf. At Property Finance Corp. we know the questions to ask so you can organize a good financial picture and present yourself most positively to lenders. And once we have a clear picture of your financial needs and goal, we can match you with the mortgage product most suitable for you.

Secure the best terms and save yourself the most money possible by following these four steps when it comes time to renew your mortgage:

1. Start Early: Begin to prepare for renewal about 4-6 months before the end of your mortgage term. This will give you time to organize yourself to present your financial picture to potential lenders. This will also give you time to stabilize your finances. Having an orderly and comprehensive report of your financial health will help you command the market’s best mortgage rates and terms.
2. Shop Around: As you prepare to renew, shop around and explore your options. Lenders will be competing to attract your business. There are options for lower rates, longer terms, and even ways to acquire new rates without penalty. A discussion with a broker can help you clarify your goals for your new mortgage. Payment flexibility, access to equity, and more can make a mortgage a better fit than just the lowest rates. Let your broker help you find the most suitable mortgage renewal product for you.
3. Negotiate: A lender’s posted rate is often not the best rate they are able to offer. Having a skilled, knowledgeable, and confident negotiator on your side is crucial to ensuring you can access the most attractive renewal products available.
4. Pay Down Your Principal: Even after you have secured a lower rate, consider maintaining your old monthly payment amount. Ensure that the difference between your old and new payment amount is applied against the principal and you may be surprised at how much you can save in interest over the term of your loan.

According to the Bank of Canada people who use a mortgage broker when renewing their mortgages often pay less than those who choose to navigate renewal alone. Partner with Property Finance Corp. when the time comes to renew and have access to an abundance of resources, tools, broker knowledge, and negotiating power to ensure that you get the terms and interest rates that make sense for you. Don’t just sign your lender's renewal on the dotted line, take the time to explore the options that will help you meet your financial needs now and for years to come. Call on Property Finance Corp. as your partner in smart mortgage renewal. Call us at 1-844-PF1CORP (731-2677)