6 Tips to Help Renew Your Mortgage

The biggest monthly expense for most Canadians is their mortgage payment. So
before you decide to renew with your current mortgage lender, take a look at these tips to help lower your payments come renewal time.

1. Get Started Early
Start shopping around for a better rate four to six months before your mortgage is up for renewal.
This is the longest lenders can guarantee a discounted rate. If your current lender’s rate rises, you have your guaranteed rate to fall back on.

2. Do Your Homework
Find out what other lenders are offering before you negotiate a lower rate from your bank. View our current rates at www.www.yourmortgagenow.ca

3. Never Accept the Bank’s Posted Rate
If you don’t ask for a better rate, you won’t get one. If you current lender has the best mortgage features, advice and policies, ask your bank to match a competitor’s lower rate.

4. Negotiate on other Available Options
The amortization period, the rate type (fixed or variable) and the flexibility of the payment schedule can also determine ways to lowering your costs, not just the interest rate.

5. You Can Change Lenders
A lot of people renew with their lender and don’t even think about switching to another one. You could be missing out on what other financial companies are offering, plus there is no penalty if you switch at renewal time.

6. Use a Mortgage Broker
If you don’t like negotiating and don’t have the time to research rates, a mortgage broker will do ALL the legwork for you — even without charging you anything, since they are paid a commission from the lenders.


Did You Know
Saving even half a percentage point on your mortgage rate can save you up to $10,000 over 25 years (based on a $150,000 mortgage).


If your mortgage is coming up for renewal in the new year or you have questions about your current mortgage, contact us today!

Things To Do Before You Renew Your Mortgage

If you have a mortgage coming up for renewal this year, it’s a good idea to check on a few details well in advance of your current term’s expiration date.

For example, determine whether you need to produce new documents to verify ownership before you get your new financing in place. An old property survey or condo agreement that is outdated and/or in need of correction may require official amendments before you can secure your new mortgage. Since such documents can take time, it’s wise to keep an updated file of all changes to your ownership status and have it ready when it’s time to renew.

Is your mortgage up for renew? Make sure to contact us to secure your low interest rate! (306) 244-7755 or devinandwes@www.yourmortgagenow.ca

Debt Consolidation With Your Mortgage

With the availability of credit, you may have a car loan, credit cards or other debt starting to mount, and maybe taking a toll on your budget. For some, it can be easy to max your credit card, get that new car loan, but then find it hard to keep your payments under control. You may want to consider increasing your mortgage to pay these debts out. This will not only reduce your monthly commitments, but also ease the strain on your monthly budget.
If you are thinking about consolidating other debts with your mortgage, you may have questions like:

  • Can you consolidate your current debts into your mortgage?
  • Will my current bank or lender allow me to do that?
  • What will be my monthly repayments on my increased mortgage?
  • Banks or lenders lend against the value of your home, do you have enough equity in your home to increase your mortgage to pay out those debts?

There are many options if you are thinking about consolidating your current debt into your mortgage. It is important to speak to a qualified Mortgage Broker to see which option suits your financial situation. A Mortgage Broker will look at your current bank or lender, and if that doesn’t suit, look at different banks and lenders they deal with, so they can explore many different options, and find one that suits you best.

What Type Of Debts Can You Consolidate With Your Mortgage?

All banks and lenders have different rules about what you can consolidate into your mortgage. It is important to get some information from your Mortgage Broker first, so you can learn what you can do, and then make an informed decision on what is the best option for you. Some of the types of debt you can consolidate are –

  • Credit Card Debt.
  • Car loans or personal loans.
  • Business Debt.
  • Tax Debt.
  • Investment Debt.

What Are The Advantages and Disadvantages Of Consolidating Other Debt With Your Mortgage?

Some advantages and disadvantages of consolidating your current debts with your mortgage may include –

Advantages

  • Your interest rate on your mortgage is more than likely cheaper than credit cards and other loans, saving you money.
  • You monthly commitments (repayments) may be reduced, helping your monthly budget out.
  • You may want to make a plan paying that debt down faster by consolidating it into your mortgage, and paying more than the minimum repayment, thus saving you money and interest charges.

Disadvantages

  • Although the your minimum monthly repayments may of been reduced, some of the debt in the longer term may cost you more money. For example: a car loan may of been taken over a 5 year loan term, but on your mortgage, even though the interest rate may be cheaper, your mortgage may be over a term of up to 25 years, therefore increasing the amount of actual interest you pay on the original car loan, as it is now paid over the remainder of your mortgage term.
  • Reduces the equity in your home. This may be an issue in the future, if you want to buy another home, investment property etc.
  • There maybe a fee to increase your mortgage or refinance your mortgage to another bank or lender.

It is important to talk to a Mortgage Broker , and determine what may be best for your financial situation before you make any decisions. This way you can learn the pro’s and con’s of consolidating other debts into your current mortgage, and make an informed decision.

Contact us today!

The 5 C’s of Credit

Applying for a mortgage can be a nerve-wracking experience when you’re not sure what to expect. Before you go looking for credit, take a few minutes to understand what lenders are looking for:

How might you stack up in a lender’s analysis of the five C’s of credit?

CAPACITY

Be prepared to show that you can afford your payments. The lender will look at your income from all sources, and compare that with your monthly financial obligations.

CAPITAL

Your downpayment demonstrates that you can save and accumulate assets, and that you are more likely to do all you can to keep up with your mortgage payments.

COLLATERAL

This is the lender’s assurance that the mortgaged property is marketable and can be re-sold to recover the investment.

CREDIT

Your habits in meeting your debt obligations will be evaluated. Do you consistently pay your debts on time?

CHARACTER

Are you sufficiently trustworthy to meet your obligations? Your education and work experience will be factors, along with length of time at your current residence and job.

Pros & Cons of a 5 Year Fixed Mortgage

The shorter the amortization the larger the monthly payments. Under the right circumstances, a five-year fixed can be an excellent product that brings very favorable interest rates with it.

Fixed-Rate Mortgage Basics
 
One of the best things about fixed-rate mortgages is that you can count on your interest rate. Borrowers of variable-rate, or adjustable-rate, mortgages (ARMs) are vulnerable to potential increases in rates. The downside to a fixed-rate product is that if market rates drop your rate still remains the same.
Larger Monthly Payments
 
Monthly payments with a five-year mortgage are larger than for the same loan amount spread out over a longer period of time. If you had a loan for $150,000 at 5 percent, each monthly payment would be about $2,830. The same loan spread out over a 15-year term would have monthly payments of $1,182, and over a 25-year term you’d pay just $872 each month. The big question is whether or not you can really afford that larger payment. The lender will require that you have a higher income in order to qualify to make larger payments.
Lower Interest Rates
 
When it comes to mortgages, the lowest rates usually come for the shortest loan terms. This is probably the single best thing about a five-year mortgage. The difference could be 1 percent or more for a five-year as compared to a 15- or 25-year product. It’s a matter of simple math: the lower your interest rate, the less you pay in the end.
Life-of-Loan Costs
 
Over the life of the loan the savings for a five-year loan are great. That $150,000 mortgage at five percent would cost you a total of $289,883 in principal and interest if you took 25 years to pay it. That’s nearly double the original home cost. Paid over 15 years the total cost would add up to $213,514. If you paid it off in five years, the total cost would be $169,841, not that much more than the original loan amount.
Who Should Get a Five Year Mortgage
 
For anyone who can afford to make the higher monthly payments, a five-year fixed mortgage is an excellent option. Refinancing to a shorter term is a great option for someone who’s been in a house a few years already. Shorter mortgages are also a good product for someone who is a conservative investor and would prefer to pay off his home rather than to use the extra cash toward other investments.
Who Should Not Get a Five Year Mortgage
 
Many people argue that if you can secure a low rate mortgage, you’re better off with a longer term that will free up more money every month to invest elsewhere. A disciplined investor who will actually follow through with the alternative investing plan may be able to rationalize this strategy, but if you’re prone to temptation and might just spend the extra money on foolish things, you’re better off paying the mortgage down. Few investments come with any guarantees, but you can count on the lower mortgage interest rate that comes with a shorter term.

What Comes First the Mortgage or the House?

Many people get it backwards. They shop for a home, and then make an emotional decision without knowing what they are able to afford. And then are surprised and disappointed to find out that they cannot get the financing. Thankfully, mortgage brokers do the homework for the applicant to see whether they have the ability to repay the loan while in the lifestyle they are accustomed to.

Something’s to consider about your lifestyle:

  • Are you single or a family of six? Costs for food and clothing alone are very different.
  • Do you take annual vacations?
  • How often do you like to eat out?
  • Are you involved in costly sporting activities?
  • Would you be willing to sacrifice these things for a bigger or nicer home?

Also take into consideration the following:

  • Do you have car payments?
  • Do you have to repay student loans?
  • How much do you owe on your credit cards?
  • Do you have bad debts?

Falling in love with a home without considering the REAL impact on your lifestyle is a recipe for unhappiness….either in re-adjusting to a “lesser” home or disappointment over the lack of vacations or entertainment.

Our advice is to focus on your financing. Find out what you can afford from a lender’s perspective, but then, spend some time considering the cash flow realities of your choice.

Additionally, we can advise you on ways to properly represent and transfer your assets, how to explain and document your income, as well as, assist you to get your optimum credit score. This process will help smooth out some of the bumps during the mortgage process, giving you the best change to the best mortgage rates available. All your prep-work will pay off in the end.

The choice is clear get the mortgage before the house!

We have joined the Trusted Saskatoon Family!

 

Last month, we joined forces with TrustedSaskatoon.Com. This is an ideal opportunity to be a part of a growing community of businesses right here in Saskatoon.
TrustedSaskatoon.Com is a great resource to save you time and money. They have done the research on each company for you. All the businesses on this site are contracted to uphold the 5 TRUSTED GUARANTEES:

1. Provide the service and quality promised.
2. Complete the job on time.
3. Charge the price quoted with NO surprises.
4. Communicate honestly and be responsive to customer needs.
5. Resolve any issues with customer satisfaction in mind.

So what does this mean for us?
We take pride in providing top notch service and product to our clients, so why not spread the word? We take the time to listen to your individual situation, answer your specific questions, and meet with you on your schedule. We have access to over 20 lenders and can access new products immediately. Plus, it doesn’t cost you anything for our service! We can essentially negotiate the lowest rate for you, and because we acquire high quantities of mortgage products, we can pass volume discounts directly on to you. Now let’s see your bank do that!
Like any other Trusted business, we make you number one!  YourMortgageNow.Ca is always free to help because the most important mortgage is YOURS!