Are You Renewing Your Mortgage?
If your mortgage agreement is with a federally regulated financial institution such as a bank, the lender must provide you with a renewal statement at 21 days before the end of the existing term. This statement must contain the same type of information as is in your agreement such as interest rate, payment frequency, term and effective date. It must be combined with a mortgage renewal agreement. If your lender decides not to renew your mortgage, it must notify you at least 21 days before the end of the term. But you don't have to wait until then. Approximately four months before the end of your mortgage term, you should contact various lenders and mortgage brokers to find a new mortgage with the terms and conditions that best suit your needs. When you are negotiating an interest rate, ask your current lender if they can offer you better terms and conditions than in the current agreement. Shopping and negotiating with your current lender might save you money. On the other hand, if you don't take charge of the process, you might not get the best interest rates that you could. Your renewal date is a good time to review your needs. Do you want to pay off your mortgage faster? Would you change the payment frequency? Do you need funds for a renovation? Do you need to consolidate other debts that have higher interest rates? If money becomes available, or if you wish to sell, can you pay out the mortgage with penalty or without penalty? Can you take the mortgage with you if you move? If you sell, is the mortgage assumable by your buyer? Time spent now may save you money spent later.