Mortgage Renewal

[shane_c]

Just curious what happens when it's time to renew the mortgage.

Our first 5 year term will be up next year sometime. Will we just get a letter in the mail to tell us our new payment? Do we get options as far as what term we want to do, variable or fixed, length, etc?

Do you have to go through qualifying again. In other words, they do another credit check, provide them with employment letters, bank account statements, etc?

[ericschand]

Originally Posted by shane_c

Just curious what happens when it's time to renew the mortgage.

Our first 5 year term will be up next year sometime. Will we just get a letter in the mail to tell us our new payment? Do we get options as far as what term we want to do, variable or fixed, length, etc?

Do you have to go through qualifying again. In other words, they do another credit check, provide them with employment letters, bank account statements, etc?

I've had mixed results. A couple of times I had to go in and tell them.
Other times they mailed me a package. You should go in and talk to
them about it, check out your options.

I had to show them I was still employed, still getting paid.

Also, if you have less than one year, you may want to see if you can
renew now. Some banks are offering 5 year fixed @ 4.19. They may
relent and take you for another 5, rather than risk you going elsewhere.

ers

Call Erin @ Urban Mortgage in the Southcentre professional building. She'll hook you up with the best deal and she does alot of the work for you.

[fredr123]

What happens if you had one of those 40 year zero down mortgages and it comes time to renew? Can you renew that same "deal" (even though you can't sign up for a mortgage like that anymore)?

[Rathji]

Originally Posted by fredr123

What happens if you had one of those 40 year zero down mortgages and it comes time to renew? Can you renew that same "deal" (even though you can't sign up for a mortgage like that anymore)?

I doubt it.

AKAIK you are taking out a new mortgage , as opposed to renewing the old one.

[Bobblehead]

My mortgage comes due at the end of this month. My lender (TD Canada Trust) sent me a letter the first week of January. In it, it had a whole grocery list of rates and options, and said, "Just initial the one you would like to accept." All the rates listed were BRUTAL. Then the branch that handles my account called and I set up an appointment to see them. In the interim, I contacted CPer Mike Oxlong and got him involved. I told him what I was offered in the letter and asked if those were in the ballpark. They weren't.

So I went to the meeting at the bank and the first thing I was told was to ignore the rates in the letter, that they weren't very good (but that left me wondering how many people just initial and return, and accept bad rates.) So at this meeting, the rate she offered was 1.6% lower than the one in the letter. But I told her I wanted to ask a Mortgage broker. She also said she had room to match better offers, and to let her know. This was on a Friday. So I let Mike Oxlong know the new numbers, and he gave me a few better rates. I left a message for the Bank. The the Bank of CAnada lowered rates again. On Wed. the bank got back to me with a rate .66% lower than Friday's offer. There were a couple institutions that had a rate .1% lower again, but I couldn't get TD Canada Trust to go that low (but I did get them to split the difference). They sent me a fax with the agreement, I signed and faxed it back, and it was done.

Moral of the story - get a Mortgage broker and don't sign the first offer.

[ken0042]

When I bought my house I had assumed my mortgage; mostly due to my credit situation. I was originally concerned because the one black mark on my credit report wasn't due to be removed until 2 months after my mortgage renewal.

But like Bobblehead they sent me a list of options, had me sign the one I wanted and send it back to them. Fortunately they were also offerring competative rates so I wasn't on the hook for a high rate or anything.

[ShotDownInFlames12]

Originally Posted by Rathji

I doubt it.

AKAIK you are taking out a new mortgage , as opposed to renewing the old one.

As long as you aren't adding funds to your mortgage, you will keep the same terms you had. Only the interest rate will change.

For people that had 40 year mortgages, that is what they signed for so unless you want to change it, the bank won't. There are still tons and tons of people that have 40 year mortgages.

As for rates, defintiely shop around. A letter does get sent out usually a month before but they are just the posted rates, as it's been mentioned. And yes there are quite a few people that just sign the form checking off how many years and are done with it. If you call your bank you will always get a discount, the more you have with them, the better they will do on rates.

[Bobblehead]

Originally Posted by fotze

So you used Mike Oxlong and you still went with the higher rate, the guys who tried to pull a fast one on you? I woulda told them they have to beat the other guy, I never go with the person willing to match, the guy who did the first drop deserves the business. Unless I'm missing something like you possibly saved some lawyer fees?

I talked with Mike through the entire process, the final difference was .05% (and the other place was a company I have never heard of before), my mortgage is fully paid off at the end (the difference in interest paid is, by the end, less than $100), I didn't need to re-apply (no additional fees), TD Canada Trust also has some other business of mine (HELOC), and in my experience they have great customer service.

[Mike Oxlong]

Originally Posted by shane_c

Just curious what happens when it's time to renew the mortgage.

Our first 5 year term will be up next year sometime. Will we just get a letter in the mail to tell us our new payment? Do we get options as far as what term we want to do, variable or fixed, length, etc?

Do you have to go through qualifying again. In other words, they do another credit check, provide them with employment letters, bank account statements, etc?

When does the mortgage renew?

As other people have stated what they will do is send you a letter giving you a number of options to choose from. DO NOT sign this and send it back to them. 9 times out of 10 it will be far higher rates than what you can get.

I would be more than happy to help you out through the procees. I can at least give you competitive rates to go to your bank with as a bargaining tool like I did for Bobblehead or I might be able to get you in a better mortgage than they are offering all together.

PM me and we can discuss your situation and figure out the best plan for you.

[Boblobla]

I will try posting this here because there doesn't need to be two threads on the front page with mortgage questions...

The Mrs. And I are looking at buying a home within the next few months and everyone you talk to has their own opinion as to whether to go to the bank or a broker. I really have no idea so I will ask for some more opinions to confuse myself.

If I do go with a broker, what questions should I ask?

What exactly does a broker do that a bank doesn’t?

What are the risks of going with a bank/broker?

[ken0042]

Originally Posted by Boblobla

What exactly does a broker do that a bank doesn’t

The biggest thing is they will shop your mortgage around to see who can get the best rate for you. Then the mortgage broker gets a fee from the bank once you sign.

So if you go into a bank; they will give you one rate- theirs. A broker will give you several; as well save you the time of shopping around because they already know not to bother with "Bank X" because their rates are too high.

[Sample00]

I feel a bad for Mike Oxlong though.
He got used and didnt profit from it. I dont meant to take a shot at my other CP friend there and I certainly dont mean to stand up for Mike either, its just that a guy who makes his living off mortgage commissions got used. And to use his services for the most part is free.
Having been a mortgage broker,I have seen that too many times and one of the main reasons why I got out of the business.

[Mike F]

One thing not brought up yet: Your original mortgage undoubtedly contained a clause that said that if you don't respond to the bank's renewal letter in time, they can renew your mortgage on the terms offered for a specified period (usually 6 months) -- so don't ignore it too long!

[ShotDownInFlames12]

Originally Posted by Mike F

One thing not brought up yet: Your original mortgage undoubtedly contained a clause that said that if you don't respond to the bank's renewal letter in time, they can renew your mortgage on the terms offered for a specified period (usually 6 months) -- so don't ignore it too long!

While that is true (if they don't hear from you, it's renewed to a 6 month closed mortgage at posted rate). YOu can always early renew 6 months in advance with no penalty, so if you do miss the renewal date, you don't have to take that rate for the full term.

[Frequitude]

How does it work if you're in the middle of your 5 year term, but want to lock in if you find a good rate out there? I've been floating at prime-0.8 for two and a half years now, but want to lock in in the next quarter or two.

Can you do that? Can I go somewhere else and say "you can have my business at this great rate you've posted if you buy out my mortgage over there"?

[photon]

I had one situation where a broker did some work for me and we ended up not going with him.. the bank gave me an offer he couldn't even find something to match with let alone beat. In that case business is business, but we still gave the broker some $$ for their time, they were quite surprised.

[Doctordestiny]

Originally Posted by Boblobla

I will try posting this here because there doesn't need to be two threads on the front page with mortgage questions...

The Mrs. And I are looking at buying a home within the next few months and everyone you talk to has their own opinion as to whether to go to the bank or a broker. I really have no idea so I will ask for some more opinions to confuse myself.

If I do go with a broker, what questions should I ask?

What exactly does a broker do that a bank doesn’t?

What are the risks of going with a bank/broker?

Risks? What risks? I'd never go through the bank. I'd always use a broker. There are no risks. Just because he/she doesn't have RBC attached to the name doesn't mean it's risky.

[Bobblehead]

Originally Posted by Sample00

I feel a bad for Mike Oxlong though.
He got used and didnt profit from it. I dont meant to take a shot at my other CP friend there and I certainly dont mean to stand up for Mike either, its just that a guy who makes his living off mortgage commissions got used. And to use his services for the most part is free.
Having been a mortgage broker,I have seen that too many times and one of the main reasons why I got out of the business.

I actually worried about that, and asked how I can include Mike in the deal. Here was the response I got back:

Don't worry about cutting me in on the deal. If they can match it then you are all set. If not we can look at other options. Happy to help out a CP'er.

So I will be referring anyone interested on to Mike Oxlong, and actually I already forwarded a co-worker who is wondering about renewing early while the rates are low.

[DementedReality]

someone posted that if you are renewing with your bank, you have to prove you still have an income.

what about those of us who got laid off, will they kick you out of the house even if you are managing to meet all your obligations?

that could be ugly!