Review before you renew

Why you should shop around when it comes time to renew your mortgage

For women, comparison shopping is practically an Olympic sport. When it comes to hunting down outstanding deals and discounts, women have an almost superhuman sixth sense. So why don't we use it when renewing our mortgage? According to the CAAMP (Canadian Association of Accredited Mortgage Professionals), nearly 70% of Canadians sign back their mortgage renewal without even thinking to shop around for a more affordable rate. Talk about a missed opportunity! The mortgage renewal period is the perfect time to refinance your payments and take advantage of competitive rates.

Reviewing your options

When it comes time to renew your mortgage, make sure you take the time to review all of the available options. Like shoes, mortgages come in all shapes and sizes, and they're constantly changing based on market trends. Just because your lender offers you a reasonable renewal rate, that doesn't mean it's the best one for your unique financial situation. Moving your mortgage during the mortgage renewal period is perfectly acceptable and, provided you are not breaking your mortgage terms prematurely, can often be done without any financial penalty.

Rules for mortgage renewals

It's worth noting that the rules for switching your mortgage may vary provincially. As such, it is highly recommended that you consult with a professional mortgage broker prior to renewing your mortgage in order to ensure that you're aware of the small print.

Common costs associated with switching mortgage lenders

There may be some costs associated with switching mortgage lenders, especially if you try to make the change on your own. If you're considering switching your mortgage, make sure that you work with a professional mortgage broker in order to receive the best possible arrangement. Costs that you may encounter when switching mortgage lenders are:

1. An appraisal fee

   Every lender will need to know what the fair market value of your home is prior to creating a financing plan.

2. A discharge statement fee

   You may be assessed a lender discharge fee if you decide to leave your current mortgage provider at the end of your renewal term.

3. Legal fees

   Every mortgage needs to be registered, which requires legal counsel.

Many lenders will jump at the chance to cover a portion, if not all, of these costs in order to gain your business. Make sure you consult with your mortgage broker to see which fees will apply to your changeover.

Don't be hasty

Mortgage lenders rely on the fact that most people are too busy to inquire about lower mortgage renewal rates. Luckily, comparing lender rates is easy when you have access to online resources and professional expertise. Professional mortgage brokers work with a wide network of lending institutions in order to provide you with access to the best available rates.