Why you should shop around at mortgage renewal time

When your mortgage comes up for renewal, you might not give it a second thought. On the surface, it can feel like just another piece of paperwork to sign and forget about. In fact, your lender will often send you a renewal offer a few months early. Many home owners accept it without too much consideration, wanting to get the process over and done with. However, shopping around at mortgage renewal time can save you thousands of dollars over the life of your mortgage. While you might assume that sticking with their current lender is the best option, this is not always the case. Renewal time is your chance to revisit your financial goals, compare options, and see if your current product is still the right fit. Here’s why shopping around is so important.

Your financial situation may have changed

When you first got your mortgage, you may have been in a different stage of your life. Maybe you were a first-time home buyer, and your main goal was just securing a mortgage. You might have had lower income, debts to pay off, or a shorter credit history than you do today. Fast forward, and your financial picture might be quite different. Apart from potential changes in your personal finances, you have also built up equity in your home. This means you might qualify for better rates or products than when you signed your original mortgage. Shopping around ensures that your mortgage reflects your current circumstances, and not those from a few years ago.

Renewal time is an opportunity to re-evaluate your goals

As a home owner, you have likely come to learn that your mortgage isn’t just about interest rates. It’s also important to have the flexibility you need, and terms that suit your lifestyle. At your mortgage renewal time, you should think about whether your current product still gives you what you want and need. For example, maybe you want the option to make extra payments toward your principal. Perhaps you are thinking about moving in the near future. You might even be looking to shorten your amortization period to pay off your mortgage faster. Your renewal gives you the chance to re-adjust your mortgage to match your plans. If you stick with the first offer you receive, you might miss out on better options.

Your first offer is not always the best deal

As we mentioned, your lender will likely send you a renewal offer in advance. However, the renewal offer your lender sends you is not necessarily the best option for you. Lenders will reach out with this offer knowing that many home owners don’t take the time to shop around, and will often accept without much consideration. If you simply sign and send it back, you may save yourself a bit of time. However, you will also be locking yourself into a deal that might not be the right fit. On the other hand, if you shop around, you’ll get the chance to see what other lenders are offering. This could allow you to negotiate with your current lender, or simply make the switch to a new one.

You can experience big savings

Of course, one of the main reasons to shop around at mortgage renewal time (but not the only one!) is the money you can save. Mortgages are huge financial commitments. Even a small difference in your rate or terms can have a major impact on your financial future. Over the years, you could save thousands of dollars through a lower rate, prepayment options, or a shorter amortization period. This money stays in your pocket and allows you to expand your financial horizons. You can pay down your mortgage faster, build your savings, support a child’s post-secondary education, or invest in anything else that’s important to you!

Working with a broker takes away the stress!

One of the biggest reasons people avoid shopping around during their renewal is because they don’t know where to start. The process can seem intimidating, and many home owners choose to stick with what they know. However, the good news is it doesn’t have to be so complicated. That’s where a mortgage broker comes in! Brokers work with a variety of lenders, such as big banks, credit unions, and private lenders. Instead of you having to narrow down your options individually, we compare rates and products for you, and find you the best choices. Renewal time is your chance to take advantage of your situation, and is not something you should rush through. With the right professional guidance, you can make it easy and stress-free.

Remember that your renewal time is an opportunity for you. By shopping around, you can take control of your mortgage, and be sure your product matches your financial goals. While it may feel easier to sign the first piece of paper your lender sends, there might be better options out there. After looking around, your current lender might still be your best fit, but it’s always a good idea to take this time to explore. We are here to help you navigate this process, saving you time, stress, and money. If your mortgage is coming up for renewal, feel free to reach out! We can explore your options together and make sure you’re in the best position possible.

If you have any questions about your mortgage, give us a call at Centum Home Lenders! You can reach us at 506-854-6847, or get in touch with us here.