As our economy shifts and the Bank of Canada is trying to slow inflation with the continuous rate hikes over the past 18 months, we are at a very different time in the mortgage market, especially for those facing a mortgage renewal.

With over 50% of mortgages in Canada coming due in 2025 and 2026, more and more people are being faced with renewing their mortgage into new terms with much higher rates than what they have been used to.  It’s important to know what to look for, what to expect, and how to plan so you can adjust your budget accordingly if needed.

Rates are the highest we have seen since the early 2000’s. This coupled with the government imposed stress test that was introduced in 2016 is making it much harder to qualify for mortgages today. We also saw our last set of major mortgage rule changes in 2017 which have also impacted home owners when it comes to mortgage renewals and qualification.

When renewing your mortgage, you have a few different options to consider;

1. Renewing your current balance and amortization (total time left on your mortgage) with your current lender into what ever rate they are offering you, and not making any changes at all.  This does not require re-qualification in most cases.
2. Renew with a *new* lender, keeping your current balance and remaining amortization the same, but shopping the mortgage with all lenders for best rates in the market.  This is the same process of a new mortgage and requires re-qualifying.
3. Refinance (means changing the mortgage amount and/or amortization) at best rates in the market which involves seeing a lawyer or notary. Most commonly done when accessing equity to renovate, consolidate debts or make another large purchase. This process requires re-qualifying.

Renewal Timeline:

• 6 months before – we update your file with your current employment and financial situation so that once we are within the 4 month timeline to hold rates, we have all accurate information on file to make the process easier
• 6 months before – we start discussing if there are any potential changes you want to make to your current mortgage as well as your current cash flow
• 4 months before – we can hold a new rate for you with the best lender and rates in the market. This is important as the rate market is so volatile that there can be drastic differences (nearly 2%) by securing a rate early vs leaving it to the last minute.  Even though we have a rate held for you, we will continue to then monitor all other banks and if rates come down lower than what we have held with any other lender, we will secure that rate as well so you are protected
• 2 months before your maturity date, we will ask you to obtain or we will request on your behalf, what your current lender is going to offer you so we can compare it to what we have held for you
• 30 days before your maturity date you should have made your decision with what route to go as it does take time to either switch your current mortgage to the new lender or refinance your mortgage.  Leaving it to the last minute leaves you at risk of missing on out on previous rate holds or having to accept whatever your current lender offers you
• Reminder: we have room for negotiation with either a new lender or your current in getting the most competitive rate for you
• If we did NOT arrange your current mortgage and would like our help with your upcoming renewal, please reply to this email or contact our office

1. Full product and lender review across all banks
2. Expert advice and individual mortgage strategy developed based on your personal situation
3. Rate negotiation on your behalf
4. Zero cost for our services
5. Full VIP service at our office rather than be treated like a number
6. Accessibility, we are available by phone, text or email 7 days a week

CLICK HERE for access to my calendar to book a call to discuss your upcoming mortgage renewal.  Remember to do this at least 4 months in advance of your mortgage maturity.

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Have a wonderful rest of the week ahead!

Trish