Do you have a mortgage renewal coming up in 2023?
If so, rising interest rates may have you worrying about what your new mortgage payment might be. Many homeowners are struggling with affordability and an increased mortgage payment might not be an easy pill to swallow. So, how do you save money on your mortgage renewal and make sure you’re getting the best rateavailable to you?
As long as you’ve paid your mortgage on time and never missed a payment, odds are very good that your current lender will reach out between 3-6 months before your renewal date with a renewal offer letter. However, your current lender will never offer you the best rates on your first renewal offer!
You can save thousands in interest by shopping around to make sure you’re getting the best deal. The easiest way to do that? Use a mortgage broker! Your broker can compare rates and products for you to ensure you’re getting the best rate and product on the market for you.
Using a broker is free to you (in most cases) and they work for you, not the lender. Most lenders will offer better rates to new customers, so it usually works out in your favour to switch lenders at renewal time. To switch, it doesn’t cost you anything as the new lender also covers the cost of the transfer. It’s a win-win!
What happens if you don’t qualify?
If you’ve recently lost your job or came into debt, you may be worried about an upcoming renewal and not qualifying for your mortgage. If you don’t qualify to switch your mortgage, you’ll always be able to sign your renewal offer at your current lender. If this is the case for you, we recommend a shorter term than the standard five years so that you can shop around when your finances rebound.
Brie Robertson and Katie Whyte are mortgage brokers and owners of Illuminate Mortgage Group