Sooner or later, your mortgage will come up for renewal. You’ll typically receive a notice of renewal 90 days before the date. That’s the time to pause, review all the elements of your current mortgage, and explore new ideas about how to save money and pay down your home. It’s also a good time to think about your future financial goals and if there’s better way to pay off your mortgage and plan for major purchases.
Here are a few tips to help you explore all of your options.
Take your time
When your mortgage comes up for renewal it’s a good time to shop around and compare rates. Consider how interest rates and your income have changed since you last renewed your mortgage. Lower rates could help you pay down the principal portion of your mortgage faster. If your income has gone up, you may be able to take advantage of flexible features that let you pay off your mortgage faster. But remember, a mortgage with the best rate may also have fewer options for making additional payments and may include fees that aren’t charged by your current lender. Be sure to compare features because there’s more to a great mortgage than just the interest rate.
Think about changing your payment options
You can change the frequency of your payments at any time but it’s something to consider when you sign back your renewal offer. By making smaller, more accelerated payments it’s possible to pay your mortgage off faster and save thousands of dollars in interest over the length of your next term. See the results for yourself by plugging your mortgage balance and experimenting with weekly, biweekly, or semi-monthly payment options using our payment calculator.
Think about all of your options for financing
If you think you might want to borrow more money in the near future for renovations or a vacation property, now might be the time to consider alternative ways of financing your home. Here are some things to consider:
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Is there a better type of mortgage for you? For example, switching to a fixed or variable rate option.
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Would you be better off combining a mortgage and a home equity line of credit with the Meridian Flex Line Mortgage?
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Is this the time to consider refinancing your mortgage to lower your monthly payments or finance a major purchase? A mortgage specialist can help you determine if now is the best time to renew or refinance.
Renewing is easy
If you’re happy with the interest rate and terms being offered, and have had a positive experience with your current lender, renewal is easy:
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simply sign back the renewal offer
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prepare for any adjustments in your regular mortgage payments (these could go up or down or remain similar)
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mark your next renewal date in your calendar and set a reminder five months in advance so you can plan ahead
This is also a good time to consider the length of the mortgage term you select. For example, you may choose a longer term if you like the idea of locking in your interest rate and securing steady, predictable payments. Or, you may choose a shorter term if you plan to move or renovate in the near future and want to keep your options open.
Get advice
If you think you’ve found a better rate, ask a mortgage specialist for a second opinion. We’re happy to help you make an informed decision. Contact an expert from our Mortgage Advice Centre at 1-888-220-8221 or simply book an appointment.
