When your mortgage term ends, you’ll likely receive a renewal notice from your lender. While it may seem like a simple process, renewing your mortgage without considering your options could cost you more in the long run. Here’s what you need to know before renewing.

What is a Mortgage Renewal?
A mortgage renewal happens when the term of your current mortgage expires. Your lender will offer to renew the loan for another term, often with new rates and terms. While the renewal process is straightforward, it’s important to shop around and explore other options to ensure you’re getting the best deal.

Why You Shouldn’t Just Automatically Renew

1. You Could Be Paying a Higher Interest Rate
Your lender’s renewal offer might not be the best available rate. Market rates fluctuate, so you could save money by comparing offers from other lenders.

2. Your Financial Situation May Have Changed
If your financial situation has improved, such as a higher credit score or increased income, you may qualify for better rates or loan terms.

3. Different Lenders Offer Different Deals
Each lender has unique offers. Working with a mortgage broker can help you find the best rate and terms available.

4. Consider Refinancing
If you’ve built equity or rates have dropped, refinancing might be a better option than renewing. A mortgage broker can help you decide.

What to Do Before Renewing
Review Your Current Mortgage Terms: Understand your rate, payment schedule, and any penalties before committing.

Shop Around: Compare offers from different lenders to make sure you’re getting the best deal.

Think About Your Future Plans: Whether you plan to stay long-term or move soon, your mortgage terms should align with your goals.

Evaluate Your Home Equity: If you’ve built equity, refinancing might allow you to access cash or lower your rate.

Work With a Mortgage Broker: A broker can guide you through the renewal process, help you compare offers, and negotiate better terms.

The Renewal Process
Review your renewal notice: Understand your lender’s offer.
Discuss your options: If you’re not satisfied, talk to your lender or a broker.
Sign the agreement: Once you find the right option, sign the renewal or new agreement.

Conclusion
A mortgage renewal is the perfect time to reassess your financial situation and ensure you’re getting the best deal. Don’t just sign the renewal notice—take the time to explore your options. If you’re approaching your renewal or need advice, reach out to me, Gursharan Mehal, for expert guidance.