Is your mortgage up for renewal soon? While your first inclination might be to accept your bank’s first offer, don’t! Banks rely on consumer complacency. Chances are very good your circumstances have changed since you took out your mortgage. Maybe your employment situation has improved, or maybe you’ve had a child. Almost any difference can have a profound impact on your financial life. Why would you accept your bank’s offer, when you could very likely do much better? To find the best mortgage renewal rates in Okotoks and Calgary, sit down with a qualified broker and discuss your current financial needs as well as your goals for the future.
At Mortgages by Candice, we believe we can help you do better! Here are a few mortgage renewal FAQs to help you get started.
1. Do I have to stay with the same bank?
When your mortgage is up for renewal, you have no obligation to your previous lender. View your renewal as an opportunity to evaluate your financial situation. The market has changed since you took out your last mortgage. Shopping around might seem confusing, but there is no better time to sit down with a mortgage broker and review your options.
2. When should I start looking?
We recommend you plan about four months ahead of your mortgage renewal date. Research the rates, read about new products and features, and gather some preliminary information about what might fit your current needs best. Then contact a broker and let them do the legwork!
3. Have rates really changed that much?
It is an understatement to say the economy has changed in recent years. When you received your mortgage, you might have chosen a variable mortgage because it seemed like rates were constantly falling. As the market has stabilized, rates have as well. Now is a great time to lock in a fixed rate before your payments start to go up.
4. How have mortgages changed?
New types of mortgage products are introduced all the time. Mortgages today can offer accelerated payment plans, amortizations, pre-payment options, cash back options and investment opportunities. This is why it is so important to not keep doing the same old thing. By taking a little time to discuss your family’s financial goals with a broker, you can choose a mortgage that can help you achieve them.
5. Can I negotiate with more than one bank?
Yes! There’s nothing wrong with trying to get the best offer. A mortgage is a business transaction. By starting the process a few months ahead of your mortgage renewal date in Okotoks or Calgary you will increase your chances of being seen as a serious negotiator.
6. What about refinancing?
If you have been thinking about using your equity for investments, your children’s education, or home renovations, renewal time is the best time. With your term ending, you can avoid prepayment penalties and save thousands.
7. Aren’t there a lot of fees involved with changing lenders?
While your current lender might tell you there’s a fee if you move to a new lender, your broker can negotiate on your behalf to find a new lender will most likely cover a discharge fee.
8. Are rates really that important?
By shaving one point off your rate, you can save thousands of dollars. This is why accepting your lender’s first renewal offer is such a risk.
9. I already got my offer. Can I negotiate with my current bank?
There’s nothing wrong with asking your bank for a lower rate. Thank them for the rate they offered you, and then see if they will go lower. Many times they will say yes. Of course, this illustrates how important it is to plan ahead next time. If all you had to do was ask, imagine what you could have gotten if you had worked with your mortgage broker to shop around for a better rate or product.
10. If I can get a lower rate, why not lower my payments, too?
While it might be nice to have that extra cash each month, unless your financial situation demands it, we recommend keeping your payments the same. This will allow you to pay off your mortgage much earlier.
Like many things in life, a little planning can save you a lot of headaches. When it comes to your Calgary or Okotoks mortgage renewal, it can also save you a lot of money! Remember, your bank is counting on you to sign because it’s what’s easiest, but isn’t it worth a few minutes of your time to secure your family’s financial future? Contact Mortgages by Candice today to learn more about how a broker can help.