When renewing mortgage, it is best to prepare yourself and know important facts to help clear up some of the common misconceptions about mortgage renewal.
Things you must know when renewing mortgage
- You do not have to renew your mortgage with your initial lender.
- You are free to hire a mortgage broker to help you find the best mortgage rate and terms for your new loan.
- Your initial lender must inform you of the decision to renew or not to at least 21 days before the mortgage expiration date.
- Any discounts you have received for adding life, disability or home insurance won’t automatically transfer or be renewed. The same goes for any discounts for an additional line of credit from your lender or its affiliates.
- Likewise, if you have transferred your portfolio to reduce your payments, this will not automatically renew or transfer to the new loan.
- A lender cannot pressure you into purchasing a financial package as a condition of mortgage acceptance. This is called “coercive tied selling” and you should report such to the Federal Consumer Agency of Canada – 1.866.461.3222.
- The items on your renewal contract should remain the same. This is so unless your financial institution has sent you a notice, in writing, thirty days prior to the anticipated changes.
- Your current credit rating will impact the availability of good interest rates. Late or no pays can lower your credit rating and reduce your chances of securing a good interest rating. Check our mortgage calculator to help you plan better. For more on how your credit rating impacts your mortgage rate see the Credit 101 section.
- As long as you have all your paperwork in order, a renewal will only take 3-5 business days. These papers include: such as your income verification papers, insurance, appraisal, the title, the mortgage statement and charge.
- Renewing mortgage takes good planning. If you want to get the best rate, you should start shopping around for rates before you renew about four months prior to your mortgage expiration.
Finding the Best Mortgage Rates
CompareMyRates.ca can help match you to the mortgage broker that best suits your mortgage renewal needs. We can help you find the broker with the best mortgage rates. This can help you avoid the pitfalls of automatic, costly renewal. Additionally, this helps ensure that you are in the best position to meet your personal and financial goals. Find the best mortgage rates Canada and start saving.