Late for mortgage renewal and looking to minimize the expense to change to a better rate?
If you or someone you know ever find in this situation the alternative seems to be to “Opt for a short-term open mortgage and escape as quickly as possible” you might want to consider or ask the following before taking a decision:
May I help you with your mortgage?
Short term open mortgage may come with all or some of the borrowing costs:
Will your short-term mortgage payments include principal and interest or interest only
New mortgage terms also mean new amortization charts where the first payments are normally more interest than principal in the case of principal and interest mortgages.
Are you looking to free your cash flow from a short-term tight budget?
Not always lower rates mean lower cost.
To have the above factors considered in your decision, the best is to have your mortgage assessment practiced.
Be wise and observe the terms and amortization payments schedule in your mortgage to see how much you can save with your educated decision, rather than just the standard or automatic mortgage renewal from your lender.
When you choose to renew on a yearly basis, you are also choosing to be subject to the rate that the lender will determine around 1 month before the renewal following a letter from the lender recalling the mortgage (which adds to the stress)
When you choose to renew your mortgage automatic you will also start a new term to which you need to agree, and when you start a new term, you will also start a new amortization period in which you can see that your payments will be applying more to the interest than to the principal, extending the length of time for you to liquidate your mortgage for good. This is also translated in a much expensive borrowing, costing you seriously more at the end. It is not wise in most cases to renews automatically, and why do it when you can have your mortgage assessment done for free?
Anticipating for your coming mortgage renewal, refinancing or home purchase will always pay off, it’s a smart decision and an excellent financial practice. Since you are not in control of all the factors that affect your future transaction, it is most convenience to stay ahead of the curve.
Unless you prefer the stress of higher interest rates, mortgage penalties and being declined in the worse scenarios, you surely want to plan ahead every step of your coming mortgage process.
Whether you know where to start or you have no clue, that is not the issue here, because with the right guidance, all you need to know is why you want or need a mortgage. We’ll take care of the how and perhaps even the when.
Timing is important, have your mortgage assessment practiced 6 months ahead to avoid rate increases, missed opportunities, or even false expecttations
If you are a first time home buyer, planning to renew your mortgage or to refinance existing debt and would like to know about your mortgage, prepare the following before you arrange your mortgage assessment meeting.
Personal picture ID’s including your SIN
Information about your income and most recent supporting documents
If not all your income can be supported, detail what you can and the type of income you earn (Waitress tips, construction workers, etc)
Details about your financial commitments or debts
Details about your savings
Your home rental or living history
Current mortgage statement (for renewals and refinancing)
Have your questions ready
There are always more chances you help you when you plan ahead of time
Practice your mortgage assessment, then just follow your strategy, say NO to procrastination and achieve your goal. Where there is a will, there is a way!
After a period of some stressful time in their life, this including hard work, a change of workplace, some family illnesses and some accumulation in the credit card usage , a client called me asking for some financial advise. Their goal was to recuperate their financial stability, to stop accumulating debt with high interest rates that were consuming a great deal of their fixed income and mainly to get a piece of mind to continue.
We had a chat a coffee shop and before my medium size of black coffee was finished we were filling up their online mortgage application, I simply learned what they wanted and their particulars, the rest was just a matter of simple paper work that we both worked together on.
Can I help you refinancing?
After a few days they were able to reduce considerably their high cost of borrowing and by the first month they were able to feel the financial difference, that was in the very short time, on top of that a projection of their future debt accumulation showed them a great difference in the overall reduction of their debt. Freeing cash using the equity in their home without losing nor risking any future home resale value was the triggering tool that gave them a piece of mind.
After the second month they were able to travel to Hawaii to realize a long due trip they had promised to each other to enjoy.
Today their mortgage payments are low and their debt is on the decline
As a token of thank you they shared the following pictures taken from their hotel room balcony, a time they enjoyed and will remember in their lifetime.
Here is one great advantage of renewing your mortgage loan with us, rather than banks.
Scenario renewing your mortgage with a bank for 5 years:
Mortgage amount = 300,000 mortgage rate @ 5 yrs 3.00%
Balance at maturity = 248,685 Repeat the mortgage renewal with the same factors 5 years after
New Mortgage amount = 248,685 mortgage rate @ 5 yrs 3.00%
Balance at maturity = 206,147
Scenario renewing your mortgage with a us for 10 years:
Mortgage amount = 300,000 mortgage rate @ 10 yrs 3.79%
Balance at maturity = 193,176
Savings over 10 years = 12,971
Note: Other factors should be considered before deciding the term of the mortgage
A carefully made assessment and professional advise can save you lots of money
Mortgage renewal is when your lender and you agree to extend the life of the current mortgage loan, revised terms is most likely to happen.
Before your next mortgage renewal, it would be smart to take the time to review your current situation as of your current and future stability, your lifestyle, changes that are occurring in your household and that may effect your financial situation in the near future, get a professional advise from me. Contact me now for more information
Mortgageis a registered agreement in a land titles office where security interest in a specific real property is held by a lender as a security for debt repayment by the borrower, a debt pledge
Each mortgage is a claim against the property; should the property be sold or foreclosed each claim is satisfied in order
What kind of mortgage can I help you with?
First mortgage: is the first loan registered in the title against the property
Second Mortgage: Is the loan that is registered second in time in the title against the property, is normally used to trade high credit card debts that carry high-interest rates for a low mortgage rate that eventually will reduce the cost of borrowing making it easier to eliminate that debt
A Mortgage can be conventional or high ratio Conventional mortgage: Usually when a borrower contributes a 20+% of the value of the property High ratio mortgage: Usually when a borrower contributes less than a 20% of the value of the property
A Mortgage can be open or closed:
Open: Allows the borrower to repay all or part of the principal at any time without penalties
Closed: Does not allow any prepayments or early repayments of the mortgage
There are different types of mortgage loans because they try to satisfy different needs according to the borrower’s lifestyles and affordability.
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If you already own a property, request a property value & comparable sales report when you complete your online mortgage assessment
If you have questions about what type of mortgage you need, learn about the following mortgage products
Whether you are looking for a mortgage to purchase a home, refinance your existing mortgage and your other loans or credit cards in order to pay less interest, or if you are looking for a commercial mortgage to finance your business, you can call me to help you get that financing that you seek.
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