When you bought your home, you probably put considerable effort into finding your home loan. Unfortunately, when renewal time rolls around, too many Canadians make the mistake of going with their current lender’s first offer.
Your mortgage renewal is a perfect opportunity to review your current financial situation in terms of your goals for the future. After all, the market changes every day, and it’s been years since you took out your mortgage, so why not take the time to shop around? At Mortgages by Candice, we will sit down with you at renewal time to help you make sure your mortgage is doing everything it can for you.
The First Offer Could Be The Worst Offer
Your lender is required to send you notice at least 21 days before your renewal date. Many wait until there is about a month left because they know most homeowners will choose to renew with them rather than put the time into researching the market to find the best Calgary mortgage rates. Many banks actually offer lower rates to attract new customers but don’t make that same offer to their exiting ones. Renewing without knowing your options is a mistake that can cost you thousands in higher interest and additional payments.
By educating yourself on current market rates and terms well in advance of your renewal date, you will be prepared to make a counteroffer or choose a new lender.
Use a Broker
A mortgage broker is a third-party negotiator who works with you and a lender to find the right mortgage to meet your current needs and future financial goals. Brokers are free to find the loan that fits your situation best because they aren’t employed by any particular lender. They have access to a variety of products and the lowest Calgary mortgage rates, and will take the time to get to know you so they can help you make an informed decision. Brokers specialize in individualized attention and often work hours more suited to their customers, rather than traditional banker’s hours.
Brokers have experience with a complete full range of mortgage offerings; they can save you money and hard work at renewal time. By sitting down with a broker four months before your renewal date and completing just one application and a single review of your credit, you can have access to all the options available. Visiting multiple lenders on your own not only wastes your time filling out duplicate applications, but you will also have multiple inquiries on your credit history that can lower your score, reducing your chances of getting the best rates and terms.
Working with a broker puts a professional negotiator on your side. If you have gone with a lender’s first offer before because you don’t like negotiating, or if you have ever felt like you got a lesser deal because you weren’t a strong bargainer, you no longer need to worry.
Improve Your Credit
Lenders will review your credit score and history when they review your application. A lower score can impact your ability to get the best Calgary mortgage rates. Your credit score might impact your ability to qualify. It makes perfect sense that you will be considered a better risk for a loan if you are carrying less debt. Here are a few straightforward tips to improve your credit record:
- Review your credit history at least once a year. Mistakes on your credit report could cost you thousands in higher rates.
- Make payments on time.
- Keep your credit card balances to less than half their limit.
- Reduce the amount of debt you are carrying. Most lenders want their clients spending less than 42 per cent of their income on debt each month.
Put your savings to work
Reducing your mortgage rate by just one percentage point can save you thousands, but there’s more to renewal than getting a great rate. New types of mortgages are being introduced all the time. Mortgages with shorter amortization periods, fixed or variable loans, and even flexible payment schedules can help you reduce your overall mortgage cost. Consider putting your savings toward renovation projects that can improve resale value down the road or toward consolidating debt right now to give you greater financial freedom. Your broker can help with both of these options.
Rates have gone down in recent years and lenders are competing for new customers. Mortgages by Candice can save you time and help you get the lowest possible Calgary mortgage rates available. Contact Candice today to learn more.