Time For a Mortgage Renewal?
Every mortgage comes with a specified term period. Once that term period approaches, it will soon be time to renew your mortgage. During the few months before this term is up, you should reflect on a few things. First of all, where do you have your mortgage? If it's with your bank, you may want to look elsewhere. Traditionally, banks have only been able to offer their clients one rate with limited mortgage conditions and terms. In contrast, an independent mortgage broker is able to shop around for you and get you the rate and terms that specifically meet your needs. So before you renew your mortgage with your bank, have a look at your options by consulting a certified mortgage professional before you lock in at a certain rate.
You can actually renew your mortgage as early as 120 days prior to the terms expiring. This should give you ample time to make any necessary decisions as to where you'll be looking for your renewed mortgage. Whether you decide to stay with your current bank, or whether you decide to employ the services of a mortgage broker, 120 days should give you ample time to do the necessary homework before making this decision. However, even if you leave it to a few weeks before, a mortgage broker can still work fast to save you thousands over that automatic renewal mortgage product from the bank.
What is a Mortgage Renewal?
Most mortgages are drafted with a certain term, after which the mortgage will either need to be renewed, or a completely new mortgage will have to be arranged with another organization. The term is only a portion of the amortization period, which is the actual lifespan of your entire mortgage before your home is paid off in full. Many terms for mortgages are generally 4 or 5 years. After this time period is up, a new mortgage will have to be negotiated, with new rates for that time period. Sometimes the rates at renewal will be higher than when you initially locked in, and sometimes the rate will be lower. At this time, you'll have to get re-approved for the mortgage.
Before you reapply for your mortgage, consider a few things: are the current rates the same, higher or lower than the rate that you locked in with your previous mortgage? Do you know if the rates are predicted to increase or decrease in the near future? What are the fees associated with moving over to another lender? Working with a mortgage broker will help to get all these important questions answered before you go ahead and apply for a mortgage renewal.
Reviewing Your Mortgage Renewal Options
When it comes time to renew your mortgage, you need to do the appropriate research necessary to lock in on a mortgage rate and package that is as beneficial as possible for you. Right now, in the year 2012, interest rates are at historic lows. Now is as good a time as ever to lock in at an interest rate that is most likely lower than it was when you first applied for your mortgage, and will probably be the lowest rate you will get for years to come. There is no charge for using the services of a mortgage agent, but they can save you lots of money in interest over the term of your mortgage. They can also explain all your options (fixed, variable, open, closed, hybrid, etc.) so you get exactly the mortgage that suits your current and future needs. Dreaming of being mortgage free sooner? They can look at your finances, mortgage options and goals and help you set a plan with your new mortgage.
Speak to a seasoned, award-winning mortgage broker when you are looking for a mortgage renewal in Alberta or other parts of Canada.
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