Once you are able to secure a mortgage term and the details are to your liking, usually live your life and let it slip into your unconscious mind until the next time. Of course, renewing your mortgage is something that is always out there, and if you’re prepared when the time is approaching you’ll always come out ahead.
Banks and Institutions
If you have your mortgage with a bank or other federally regulated financial institution, they are required to send you a renewal statement no less than 21 days before the existing term ends. You can receive the statement by mail or electronically, depending on your preference. Your statement must include all the information that’s in your current agreement, like the balance, interest rate, payment frequency and any fees or charges that are applicable.
Assessing Your Needs
One strategy many homeowners find useful is to start looking around for other options before their mortgage term is up. Start this process a couple months before your term is up, so you have enough time to explore your options and determine if a new option would better meet your needs. Sometimes, if you don’t become an active participant in the process, your term is renewed automatically and you won’t get the lowest rates possible.
Staying with Your Current Lender
If you go through the process and decide staying with your current lender is the way to go, you still want to ask questions. Find out if you qualify for any discounts or if it’s worth your while to change the payment frequency so you can get the mortgage paid off faster.
Making the Switch
Since you aren’t required to renew your mortgage with the same lender, you may find that using a new one is the way to go. The new lender needs to approve your application, and you will incur various fees and expenses to switch, but finding out if it is financially feasible won’t cost you anything. If the new lender really wants your business, they might waive certain fees and help you cover other ones to make the change more manageable.
They Want You, Too…
Throughout this process, it’s always wise to remember that without borrowers, lenders wouldn’t have a business. That’s not to say you can just barge in there and start calling the shots, but you may have more leverage than you think. Don’t be afraid to ask questions, because it’s the only way to really get the mortgage term you want.