Mortgage Renewal Considerations
Mortgage Professionals Canada provided a statistic stating that 85% of Canadians automatically renew their mortgages when they come due. Based on this data, it suggests that a significant portion of Canadians might be paying more than necessary for their mortgages.
Mortgage Renewal Reminders
Canadian banks typically begin contacting clients approximately 6 months before their mortgage renewal is due to mature. Their goal is to retain clients, and often, the initial offers provided during these contacts can be higher than what is publicly available on their websites. Many individuals tend to accept these offers, assuming that the bank has their best interests at heart. However, it’s important to remember that bank employees are obligated to act in the best interests of the bank, not necessarily the customer.
Contemplate Transferring Your Mortgage to a Different Lender
I have consistently observed that mortgage renewal offers from lenders are often easily surpassed by the options available in the open market. The mortgage industry provides a wide array of lenders actively seeking new business opportunities. Transferring your mortgage from one lender to another is a straightforward process, typically requiring only four essential documents from you as the client.
To proceed with the transfer, I would need your current mortgage statement, proof of property taxes paid, a letter from your employer, and a current pay stub. Compared to the extensive paperwork required during the initial mortgage application, this process is significantly simplified since no down payment is necessary.
If your home was insured by CMHC or Genworth, the existing insurance can be smoothly transferred to the new lender. Additionally, you can maintain the same amortization period you currently have. For instance, if you initially started with a 35-year amortization and it’s now time for your first renewal, you can renew with another lender at a 30-year amortization.
Restrictions Associated with Collateral Mortgage Renewals
Mortgage renewals can become challenging if your bank has classified your mortgage as a collateral mortgage. This means that there are multiple charges on your land title. It might be that the bank has part of your mortgage in a fixed rate and has also included a secured line of credit, using your home as security.
Numerous Canadians are unaware that their mortgage has been categorized as a collateral mortgage until they attempt to transfer their mortgage and discover that their home is tied to this type of mortgage. As a result, they have no option but to renew their mortgage with their current lender.
How BFL Can Help You In Your Mortgage Renewal Process?
Renewing your mortgage with MLJ Mortgages is a straightforward process. We will assess in advance whether your mortgage is a collateral mortgage and provide you with a clear understanding of the steps involved in transferring it to another lender. In most cases, the transition is seamless, and we can swiftly secure a better rate with a new lender, requiring only minimal paperwork. In just a matter of days, you could be on your way to enjoying improved mortgage terms and potential cost savings.
To kickstart the approval process promptly, simply fill out the form, and let’s begin.
Send me a Message
I will promptly reach out to initiate the process of creating your secure personal mortgage profile and expediting your mortgage pre-approval.