When a mortgage term comes to an end and there is still a balance on the existing mortgage
You will need to renew for another term.
As your mortgage approaches the end of its term, your lender will contact you with a renewal statement, either in the mail or via email. Your renewal statement will contain information you are used to seeing on your normal statements, including the outstanding balance of your mortgage, payment amount, payment frequency, interest rate, and renewal date.
In many cases, lenders will send you an early renewal offer along with your renewal statement. The terms of early renewals differ on a per case basis, but they typically include a slightly reduced rate than what is posted for typically the same length of the term you are currently in. Along with this offer is a letter you can sign and send back.These early renewal offers often do not work in your favour and their interest rates are usually higher than what else is available to you. Though convenient, you should never accept these early renewal rates without speaking to a professional first. These renewals can end up costing you thousands of dollars in unnecessary payments.
Mortgage Renewal Process
This is your opportunity to review your mortgage needs. When you are looking to renew your mortgage, you will need to review the answers to some important questions. For example:
- Will increasing your payments to pay off your mortgage sooner save you money on the interest?
- Are you satisfied with the services offered by your current lender?
- Which terms of your current mortgage do you want to change, if any? Are you comfortable with the payment frequency, the length of your mortgage term, etc.?
- Do you have other high interest debts you want to consolidate into your mortgage renewal?
Between 90 and 120 days before your mortgage term ends, contact us. Not only can we negotiate a newer, competitive rate, we can also look at other options for you that are available only to mortgage brokers.