At the end of your current mortgage term, you will have two options, pay off your entire mortgage, or renew it for another term. If you choose option number two, it’s the time to review your current mortgage and ensure you have the right mortgage for the next term. This is an opportunity for you to look back on your monthly mortgage payment and see if it still fits in with your lifestyle and financial situation for now and the estimated term of the next mortgage. Perhaps you expect more income in the next 5 years or so and making a higher monthly mortgage payment is now a feasible option, or maybe you see more expenses and commitments for your future and are looking to reduce your monthly payments.

You can ask yourself some of the following questions at the end of your current mortgage term that can help you decide what you need to do before your mortgage renewal:

Do you currently have the ability and the capital to increase your mortgage payments? This can help you pay off your mortgage sooner and can help you save on interest charges.
Do you want a better interest rate on your mortgage?
Are the services provided by your current mortgage lender satisfying you?
Would you want to switch your current monthly payments to a more accelerated bi-weekly payment? Changing your frequency of mortgage payments can sometimes let you pay off your mortgage more quickly.
Do you feel you will likely make more pre-payments?

If your answer to most of the above questions is yes, you can renew your mortgage with another lender. Here are some benefits of switching to another lender at the time of your mortgage renewal:

You can get a lower mortgage rate by switching lenders at the time of renewal. You can potentially save thousands of dollars in interest charges by switching to a lender who offers a lower rate. How, you might ask? Let us consider an actual case handled here at Oceanvale Mortgage & Finance. The mortgage amount was $350,000 to which the client was offered a renewal rate of 3.45%. This worked up to an amount of $55,966 paid on interest over the new 5-year term. On renewal the client decided he wanted to see if any other options were out there, and upon research and understanding the client’s case, our mortgage broker suggested a lender that offered a rate of 2.66% reducing his interest payments to $42,936, saving the client nearly $13,000 on his 5-year mortgage period while reducing his payments by almost $150/month. To tabulate the case, this is how it would look like:

	Mortgage Amount	Interest	Term interest amount	Term savings	Term Payment Savings
Old Rate	350,000	3.45%	55,966	13,030	1,716
New Rate	350,000	2.66%	42,936	13,030	1,716

*both rates offered were variable and the calculations do not account for any prime rate changes

This is how a mortgage broker who has access to nearly 40 lenders across the country and understands your current situation can help you get better rates on your mortgages at the time of renewals.

You can even get better terms and conditions on your mortgage from a different lender. One of the important conditions you can consider is your pre-payment option. Switching to a lender who provides better pre-payment options can help you reduce costs by not paying additional interest costs.

Moving from one lender to another can be a matter of savings, better terms and conditions, service and sometimes an even better mortgage experience. However, there is paperwork, research and situational understanding required, and that is where our mortgage professionals come in. Mortgage brokers understand your current situation and will advise you if switching to a different lender or a higher or lower rate will be beneficial.

If you have a mortgage renewal coming up, it would be a good idea to consult with one of our mortgage brokers before deciding to continue with your existing lender. It can help you benefit from your renewal!

Mortgage renewal coming up? Here’s how you can save big money on your mortgage payments!