For most Canadians, the biggest monthly expense is their mortgage payment. But, according to economic analysts, more the 30% of homeowners renew their Kelowna mortgages automatically when the term is up, without trying to find a better deal. Here are some tips that will help you lower your payments when it’s time for a home mortgage renewal in Kelowna.
Do your homework
You need to find out what other lenders are offering before you negotiate a lower rate with your bank. Many websites post the current rates from all the banks. These current rates can vary widely, so you need to pay attention to this. i.e. Scotiabank’s rate for a 5 year closed-term fixed rate mortgage is 5.29%, while for other banks like ING Direct the rate is 3.59%.
Get at it early
You need to start shopping around for a better mortgage rate 4-6 months before your existing mortgage is up for renewal. This is when lenders guarantee a discount rate. If rates rise (your current bank’s rate), you have your guaranteed rate to fall back on. On the other hand, if they drop, you can simply renegotiate a lower rate.
Say no to the bank’s posted rate
This can be compared with “you handing your wallet over to your lender”. If you are sure that your current lender has the finest mortgage features and policies, ask the bank to match a competitor’s lower rate. You need to come out and just ask for a better rate, if not you will not get one. Banks are willing to lower your rate also if you transfer over other account or investments.
Negotiate other available options
You need to stay open and not fixate just on the interest rate. The rate type (variable or fixed), the amortization period, and the flexibility of payment schedule are crucial for lowering your monthly costs.
Broker a deal
There are some that don’t like to negotiate with their lender. What is the worst is that they don’t even think of changing to another lender, even though they could find a better one. Moreover, there is no penalty if you want to switch at renewal time. As statistics done by the Bank of Canada show, people who get the help from a broker pay less than people who don’t. In general, you can save around $2000 of interest on a $210,000 mortgage over five years.
One of the best companies you can work with if you want to find a better mortgage is Rampone-Marsh Mortgages. Our team of experts from Rampone-Marsh Mortgages is at your disposal to offer you the best financial advice and solutions. You can get our help for a Kelowna home mortgage renewal and for other types of mortgages as well. Contact us and let us know about your financial goals.
Looking to move and build a home instead? They can help you with a construction mortgage in Kelowna as well.