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Mortgage renewal woes? Here's how to negotiate a better renewal rate in Midland

6 tips (and 1 myth dispelled) to help you spend less on your mortgage

Do you have your fingers crossed (along with many Canadian homeowners) that mortgage rates will be much lower when you go to renew? Rates are starting to come down, but they still have a ways to go.

If your renewal time is at hand, don’t count out your rate luck just yet. As you move from a (previously enjoyed) low rate to today’s (not as enjoyable) higher rates, you can take steps and help soften the mortgage budget hit to save money.

Here are 6 tips on negotiating a better renewal rate:

1. Don’t just accept the first renewal offer you receive from your bank

Your first offer is just that. It may come as a ‘best client’ rate, but they’re likely hoping you take it and don’t ask for a lower rate. So, ask.

Depending on their next offer, you’ll have a clearer idea of where you stand.

2. Shopping around gives you options

You may feel uncomfortable about looking around for a better rate if you’re used to sticking with your bank. But it'll be worth it if you end up with a lower mortgage payment than you thought.

There’s rate shopping, and then there’s ‘real’ rate shopping. Checking out other bank websites or even rate comparison sites may give you a wrong impression of what rate you can get.

Instead, a highly trained mortgage broker, like one of the experts at True North Mortgage, a top-rated Canadian brokerage, can quickly determine your best rate from a range of lenders by shopping around for you based on your details.

3. Using a mortgage broker service can mean less impact on your credit score

Calling up a bunch of lenders to ask for a rate quote could ding your credit score — a result of several mortgage checks on your file — and could impact any rate offer you receive.

Instead, a trusted broker can make those rate inquiries for you, counting as one mortgage credit check.

4. Get a volume discounted rate

Independent brokers in your neighbourhood may not incur enough volume to impact your rate offer. A larger brokerage, like True North, has salaried brokers who do huge volumes based on their strong relationships with many lenders.

The rate discount passed along could save you thousands of dollars over your term.

5. Switching to another lender or product may save you more than your rate

It’s important to look beyond a lower renewal rate to ensure you get the right product fit:

  • Thinking of moving soon? The lowest open variable mortgage rate in Canada could save you money and stress vs. locking into a closed term
  • Need funds to consolidate debt? Get the right lender with flexible refinance terms and competitive rates
  • What does your mortgage future hold? A lender with lower pre-payment penalties than big banks could cost hundreds less if you suddenly need to break your term
  • Want to make extra mortgage payments? Flexible pre-payment privileges and options, like free payment frequency changes, help make it fee- and stress-free
  • Should you stick with a 5-year rate or take a 3-year one? Get advice on choosing the term that best fits your needs

Use your renewal period to expose all the savings choices available to you.

6. Don’t wait too long to make your decision.

Are you ignoring your renewal offer, hoping rates will bump down? Running out of time will not help you negotiate, and you risk auto-renewing at a much higher rate.

Some lenders will send your renewal letter months in advance, others only a few weeks (they’re legally obligated to send something at least 21 days before your expiry date).

Make sure you have enough time to research your options — a True North broker can start your process 120 days in advance. You can also get a friendly renewal reminder if ‘busy’ is your main state of being.

And 1 mortgage renewal myth, dispelled

Many homeowners believe that switching lenders at renewal is too stressful and costly.

If you go it alone for a switch, you are at the mercy of both lenders’ mortgage reps and how quickly and effectively they communicate and respond to facilitate the switch.

But if you place your switch in the hands of a highly trained broker, like a True North expert, they’ll take care of all the details from beginning to end for a smooth process.

And the switching costs? It’s a myth that fees can outstrip any savings. Many lenders cover some fees or don’t charge as much as you think. Get your expert broker to run the numbers for your actual switch savings.

Sure, cross your fingers, but also rely on expert savings help

Renewals right now are stressful. As we (impatiently) wait for rates to continue their decline, it’s essential to get your best rate and product to save the most.

The experts at True North can provide personalized advice and access to better rates and solutions, whether your details are straightforward or more complex.

They also have the most 5-star reviews in the industry, which tells the story of how they have helped thousands of homeowners save thousands of dollars — and you could be next.

Get expert advice from a friendly broker in your preferred language. A few minutes could save you a pile of cash, online or in-store. Contact Canada's No. 1 Mortgage Broker today.