Of Prime Interest: Mortgage renewal can allow for lifestyle changes

Mortgage renewals are one of the most neglected decisions made during the life of a mortgage.

  • Apr. 13, 2013 7:00 p.m.

Every mortgage has a specific guaranteed interest rate for a set term period.

When that term is coming to an end, most banks will send you a mortgage renewal notice.

Mortgage renewals are one of the most neglected decisions made during the life of a mortgage.

Many homeowners stay with their existing mortgage lender because they believe it is too time consuming to shop around for a better rate.

For instance, rates available to a mortgage broker are often as much as 1.7% below the banks posted rate —that calculates into a savings of over $250 per month based on a $250,000 mortgage. Over a five-year term, that’s a $15,000 saving.

As well, a mortgage renewal holder can be pre-approved up to four months prior to the mortgage coming available for renewal.

This is the best of both worlds—a pre-approval will guarantee you the rate for up to 120 days and if the rate goes lower during that period you get the lower rate.  A win-win situation to be sure.

Mortgage renewal time is your opportunity to make changes with your mortgage and not incur a penalty for doing so.

You can  increase or decrease the mortgage amount, choose a new payment frequency, change your amortization or the type of mortgage you have.

The various types of mortgages available are fixed terms (anywhere from six month to 10 year terms), variable rate mortgages or a line of credit.

For example, a fixed rate mortgage could easily be switched to a variable rate mortgage or line of credit. And doing the reverse is also possible.

If you have any high interest loans or existing credit card debt, now might be the time to pay them off by rolling it over into your mortgage.

To increase a mortgage a renewal time, lenders will take into consideration the mortgage holder’s credit history, annual income, employment history and property value to determine those qualifications.

There is always the option at renewal time of depositing extra cash to pay down your mortgage without any penalty.

You can also leave all as is and simply negotiate a better rate.

Mortgage Renewal time is a great opportunity to make the changes that are reflective of your lifestyle today.

Just Posted

Kelowna DJs organize own shows to fill gap in music scene

The DJs wanted to create somewhere people could enjoy their music safely

Rediscover Rutland: There’s never a dull moment in the neighbourhood

Laurel D’Andrea, with URBA, is sharing a few upcoming events

Kelowna budget carryovers won’t add to taxation demand

Council’s carryover budget requests will advance work for the city

Warm temperatures here to stay in Kelowna

Spring has finally sprung in the Central Okanagan

Kelowna welcomes building permit applications for “earth homes”

Kelowna welcomes carriage and container “earth homes” when mandatory inspections are completed

Defiant vigil starts healing in New Zealand after massacre

Police say the gunman in the shooting that killed 50 acted alone

Horvat scores 16 seconds into OT as Canucks beat Blackhawks 3-2

Pettersson sets rookie scoring record for Vancouver

No injuries, pollution in Vancouver Harbour ship collision: Transport Canada

Transportation Safety Board says it has deployed a team of investigators look into the incident

Budget 2019: Five things to watch for in the Liberals’ final fiscal blueprint

Finance Minister Bill Morneau will release the Trudeau government’s final budget on Tuesday

New concussion guidelines launched for Canada’s Olympians, Paralympians

The guidelines will be in effect at this summer’s Pan American, Parapan American Games in Lima, Peru

In Photos: Classic snowmobiles pushed to their limits in fun races

The Burner in Malakwa served as the venue for races show cases older sleds

Alphonso Davies doubtful for Canada game against French Guiana in Vancouver

Canada will be without injured captain Scott Arfield and veteran Will Johnson

Okanagan organization helps provide water for all in Nepal

Presentation shares success of project at Okanagan Science Centre March 27

Most Read