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Canada Mortgage Renewal

So you have received your mortgage renewal letter from your current lender and you are in shock when you notice that your own bank has not offered you very good mortgage rates on that renewal statement. You might also notice that if you have always chosen a variable rate mortgage these mortgages have been priced much higher than what you may have been able to receive in the past. They used to be available at discounts of 0.85% to 1% below prime rate, is no longer the story and will not likely return in this market. Today, you will find variable rate mortgages priced at Prime Rate PLUS 0.50% all the way up to Prime Rate PLUS 1.50%.

When you receive your mortgage renewal statement, and you feel that your bank has not offered you the best mortgage rates, it is important for you to know that you can always take your mortgage business to another lender. There is no “penalty” to move your business, as long as you are not breaking your mortgage term prematurely. However, there are costs associated with just switching mortgage lenders, especially if you go shopping for a mortgage on your own. Here are the typical costs associated with just switching mortgage lenders:

1) Appraisal Fee: you may have to pay the cost of an appraisal when you switch to a new lender. Any new lender needs to know what the fair market value is, of your home, before they will agree to advance mortgage funds on it. Appraisal fees can be anywhere from $150 - $350 depending on the square footage of your home and these are always ordered by the lender so do not go out and hire an appraiser yourself.

2) Discharge Statement Fee: you will have to pay the cost that your lender will charge to prepare a discharge statement for your mortgage. Every bank charges a discharge fee if you leave them at the end of your mortgage term. The discharge statement fee can range from $150 - $300, depending on your lender.

3) Legal Fees: - a new mortgage will have to be registered and you will need a lawyer to do this for you. The cost to register a new mortgage can be anywhere from $600 - $1,500 or more, depending on what you are having done.

Now typically, when you get a renewal notice from your lender (before your term is ending) and you do not like what you are being offered on renewal, let me recommend a couple of options: 1) you shop the rates yourself and go back to your lender and negotiate the rate with them directly; or 2) you can call me and I will shop the mortgage rates out on the market for you. Because I deal with over 40 lenders, I can let you know if you are being offered the best deal. Once I find you a better mortgage rate, you can simply ignore your lender’s renewal “offer” and I can set up a new mortgage for you to take effect on your mortgage expiry date……it is that simple. I help clients switch their mortgages to a new lender all the time and it is a painless process.

Now if you are concerned about the “cost of switching” there is solution. I have a GREAT product just for that! Some of my lenders will pay ALL of the costs typically associated with switching your mortgage:

1) The appraisal fee is paid;

2) The discharge statement fee is paid;

3) The legal fees are covered.

So essentially, it is a NO COST switch that allows you to move your business without costing you a dime. Also, since I have the ability to negotiate discounts on your mortgage rate too, I can almost always guarantee a better rate than what your own bank is offering. Please contact me about 4 months prior to your renewal date, and I promise to give you the best service!

To learn more contact me today, I provide free no obligation information to suit your personal situation!


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Walter Pawlowski Ontario Mortgage Agent M11002486