When your mortgage term ends, you have to pay off your mortgage if there’s a remaining balance or renew it. According to Statistics Canada, 36.3% of homes in Canada have mortgages and the majority of them are term. A term is the length of time for which a mortgage agreement exists between a borrower and a lender. They generally range from 6 months to 10 years. After each term, your mortgage usually comes up for renewal if it hasn’t been paid off, and many stick with the same institution. There’s nothing wrong with staying with the same institution however, exploring alternative mortgage options could save you thousands of dollars.

A homeowner’s current situation in most cases will have changed from when they first got their mortgage. It’s crucial to reassess your mortgage needs because it could save you a lot of money. For example, if you currently have a five-year fixed term on your mortgage, your lender will probably offer you a renewal package with the same term. However, if you want to relocate to another home and your mortgage needs to change you may have to pay a penalty that could cost a lot. Perhaps you may change your payment frequency to make more payments and be mortgage-free sooner or reconsolidate some debt. No matter your needs, reassessing your options at renewal time is important.

When your mortgage is up for renewal, it is a good idea to consider your options early. You will most likely get your mortgage renewal terms 30 days prior to the end of your mortgage term. But you may negotiate with lenders 120 days prior, some lenders allow for rate holds of up to 120 days. Your best option is to deal with a Mortgage Agent because they have access to a variety of mortgages. They deal with the lenders on a continuous basis and have access to discounted rates that are normally not advertised. They can also help negotiate with the lender. In some cases they can get a special discount and the best part is, it doesn’t cost you anything extra.

When you first got your mortgage you may have gotten what is referred to as mortgage insurance. Mortgage insurance protects a lender or titleholder if the borrower defaults on payments, passes away or is otherwise unable to meet the contractual obligations of the mortgage. This insurance can be transferable from one lender to another. This is important because lenders rates are typically lower for insured mortgages than uninsured mortgages because it holds less risk for the lender. Depending on the situation a Mortgage Agent can advise on your best course of action.

Transferring your mortgage from one lender to another is very common and as such many lenders have taken action to make the processes of switching as smooth as possible. Many lenders absorb the costs of switching and sometimes you can negotiate with the lender to help cover part or all of your fees to switch from one lender to another. They want your business and it doesn’t hurt to ask. Some costs that may be associated to switching could be, setup fees with the new lender which may include discharge, registration, transfer fees and appraisal fees.

All mortgages are a charge on a property for securing money or money’s worth. But there are different types of mortgages and they all have different conditions for them. When considering your mortgage renewal it is important to consider if you have a Collateral or Conventional mortgage. A Conventional Mortgage is a charge against the property in the amount of the remaining mortgage amount. A Collateral Mortgage is a charge against your property for up to 125% of the value of the home when it was purchased. This type of charge against the property is not as straightforward as a conventional mortgage and has higher charges to transfer. With that said, many lenders understand this and have put procedures in place to absorb some or all of the charges to switch Collateral Mortgages from one lender to another.