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Time’s Up! What To Do Before You Renew Your Mortgage

Time’s Up! What To Do Before You Renew Your Mortgage

Toy house and calculator on the tableWhen it comes time to renew your mortgage, there can be many changes to be made. From smaller scale changes like frequency of payments to making big decisions in terms of switching financial lenders for better terms or more savings, there are several major steps you should take before you renew. Let’s delve into the primary steps you should take to ensure you get what you need from your mortgage at the time of renewal.

Do your Homework, and Do It Early

If your mortgage is up for renewal in the foreseeable future, don’t wait until the last minute to get started. If you’ve borrowed your mortgage from a financial institution such as a bank, they are only required to inform you of your renewal 21 days beforehand. However, it is suggested that up to 3 months prior to your renewal you should start to shop around. Unfortunately, with many mortgage contracts, if you miss the date of your renewal, your terms and rates can automatically be renewed, which can cause you to lose out on savings.

Don’t Be Afraid To Change Teams

Time feels like it flies by at warp speed so much so that when it comes to mortgage renewals it’s so easy to let the current mortgage roll over and renew without the fuss of any appointments or the headache of contemplating a new lender. However, taking the time to seek out your mortgage options can lead to huge savings depending on your current terms and rates that you are locked into. For example, there could be a big difference between the rate you originally applied for your mortgage with five years ago opposed to today’s rock bottom rates. When your mortgage renews, if you don’t investigate current rates in today’s mortgage market, your mortgage will renew at the same rate as your previous mortgage, meaning that you might be overpaying in interest unnecessarily.

Reap The Benefits Without Getting Dinged With A Fee

If you are currently a homeowner thinking of switching lenders or wanting to change your mortgage terms you’ll be happy to hear that you might be able to do so without paying any extra. When it comes to renewing your mortgage if you do your research in advance of the date that your mortgage renews, you could not only save on interest rates and reap the benefits of better terms, but you’ll also save by not having to pay extra fees for transferring your mortgage to a new lender. Much of the time you can even change lenders without needing a new appraisal of the property.

Weigh Your Options & Evaluate Your Needs

Once you get started on your mortgage homework, you’ll want to lay out all your options and compare. Much like going into a test, you’ll want to have all your information ready and understood before you begin comparing and weighing your options. Take into consideration things like changes in your income, if you’d like to change the frequency of your payments, additional payments you might like to make, and even the option of consolidating your debt. Other things to examine can include whether or not you’re happy with your current lender, or if you’re happy with certain aspects of your mortgage contract and would like to keep them. Another major factor to keep in mind when comparing costs and terms is whether or not your desired changes will tack on additional fees. These are all things you can investigate, examine and compare in order to be fully versed in your options before you go hunting for a new contract.

Don’t Be Afraid To Speak Up

Negotiating with a financial lender can be intimidating, but it shouldn’t deter you. While most often the posted rates act as a first offer, you are never harming yourself by negotiating. In fact, be sure to bring along your aforementioned homework in order to back up your negotiation. Similarly to buying a car, your mortgage can always come with add-ons. You can often save a little money if you’re willing to forgo some aspects of your terms, or live by more specific restrictions. Regardless of add-ons, your rates can always be negotiated and altered, so it is encouraged to challenge your first offer. In the same breath, ask questions! If you are unsure or curious of anything, don’t hold back on any questions!

Don’t Sign Until You Fully Understand

Like any contract, don’t sign on that dotted line until you fully understand everything above it. Be absolutely positive you understand all terms and conditions, the rates are affordable and the agreement meets your needs. Getting locked into a contract as legally solid as a mortgage can be difficult and expensive to get out of, so you’ll want to ensure you are 100% sure of what you’re signing for. It is suggested that you not sign until you’ve done your research, negotiated and asked all of your questions to give you a clear understanding of your mortgage agreement.

When it comes time to renew your mortgage, it can feel like you’re starting from the bottom all over again. Researching, comparing and negotiating, can all seem like intimidating tasks. It is important that you start early, as to not rush the decision, and make sure you understand all your options before you put pen to paper. If you have any questions regarding your upcoming mortgage renewal, feel free to give me a call at 705-315-0516. I am always happy to help you better understand your options and to give you the financial freedoms you deserve from your mortgage.

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