Save on interest payments with the right mortgage loan.

Is your mortgage approaching the end of its term? Are you wondering how to minimize the impact of rising interest rates? 

Studies show that many Canadians are now greatly worried about mortgage interest rate increases. Homeowners saw an increase in rates in 2022 and while they have started to go down slightly, people are still worried about their mortgage payments in the future.

If you are renewing your mortgage, allow us to guide you through the renewal process so you can save time and money.

How are higher interest rates affecting mortgages?

There’s no denying it: for a year now, the rise in interest rates has hit the mortgage market with full force. Increase after increase, anxiety has set in for many homeowners.

While many have been able to take advantage of record-low rates over the past few years, the imminent renewal of their mortgage will certainly reduce their purchasing power.

  • Increased interest payments.
  • Reduced principal payments.
  • Increased monthly payments.

Due to the deployment of Canada’s monetary policy, it is inevitable that the household budget of many Quebec homeowners will be negatively affected.

Good to know

Although the Bank of Canada has once again raised its key interest rate by 0.25% last January 25, there is still hope. According to forecasts by experts, rates are expected to stabilize, with no further increases in sight.

What are the deadlines for mortgage renewal?

Until the loan is completely paid off, the mortgage must be renewed at the end of each term. 

Varying from a few months to more than 5 years, many homeowners will have to deal with increasing interest rates over the next year.

To do so, it is important to know the deadlines to be followed. In Quebec, most lenders will allow you to renew your mortgage up to 30 days before the maturity date. However, if it is done before this period, penalties may apply.

Before proceeding with the renewal, it is prudent to know the terms and conditions to avoid unpleasant surprises and unnecessary fees.

Are you afraid to miss your deadline? We must point out that if you are dealing with a bank, the lender is obliged by law to provide a notice of 21 days before the end of the mortgage term.

Whether you receive the renewal notice in paper or electronically, it must include certain information:

  • The balance of the capital to be repaid
  • The interest rate
  • The frequency of payments
  • The mortgage term
  • Applicable fees

The interest rate specified in the notice cannot be increased until the time of renewal. 

Do you have any questions about your mortgage renewal? Consult a specialist from our network by filling out our short online form.

When is the best time to renew your mortgage?

Do you know the 120-day rule? This is the mortgage rate guarantee allowing you to reserve an interest rate in advance. 

To let you sleep better at night, most lenders in Quebec offer a period of 90 to 120 days to guarantee a rate.

  • It is a form of commitment that the lender offers you.
  • The interest rate cannot increase throughout the duration of the guarantee.

What happens if interest rates go down in the meantime?

You will have access to the lowest rate throughout the period. You will, therefore, be assured of a ceiling rate in addition to having the opportunity to take advantage of an even lower rate than the one reserved.

It is, without a doubt, very advantageous to use this guarantee for your mortgage renewal.

How do I renew my mortgage?

Making an assessment before renewing a mortgage.

Did you know that you are not obliged to renew with the same lender? The goal is to find the best terms, whether with the current lender or by switching to a different lender. 

Here is the procedure to follow to find the loan at the best interest rate:

Assessment

Either way, a reassessment of your needs is a non-negotiable step! Indeed, throughout the duration of your term, it is very likely that your needs have changed. 

To make sure you get the most suitable mortgage, here are the factors that need to be assessed:

  • Monthly Budget
  • Frequency of payments
  • Early repayments
  • Relationship and satisfaction with current lender
  • Any other needs related to your mortgage

Comparison

To ensure you benefit from the lowest rates available, it is essential to compare the products offered by different lenders.  

Even if you are a loyal customer of your bank, how can you be sure that the rate you are granted is THE best? You may be right to believe this, but it is worth being certain. 

You don’t lose anything by asking for other offers before you make your decision.

Negotiation

Whether it is the mortgage renewal offer from your current lender or another institution, you should know that the rate is negotiable.

Indeed, nothing is cast in stone until you have signed on the dotted line. You may qualify for a better rate so it pays to negotiate. 

Good to know

If you change lenders, be sure to check whether the transfer is subject to any fees and whether your mortgage insurance premium is affected.

Which professionals can renew a mortgage in Quebec?

In Quebec, two specialists are able to assist you in the process of financing your property. Know who they are so you can make the best mortgage decisions.

Mortgage broker

  • The broker acts as an intermediary between the buyer/owner and the financial institutions.
  • He is not affiliated with any bank. He can shop for the best product offered by mortgage lenders.
  • If necessary, he can offer alternative financing solutions.

Mortgage Advisor

  • A mortgage advisor is connected with a specific financial institution.
  • He is bound to offer you the most suitable mortgage product offered by his company.
  • He cannot assist you in comparing mortgage products from other institutions.

The advantages of working with a mortgage broker

In Quebec, a mortgage broker is the only professional authorized to shop for mortgage loans with multiple lenders. 

If you are looking for the lowest rate despite the bullish market, look no further. Here are the benefits you can get by entrusting your mortgage renewal to a professional.

  • He assembles your financials and analyzes it to ensure your eligibility.
  • He has access to a wide range of mortgage products as he is not affiliated with any specific lender.
  • His brokerage services are completely free.
  • He has in-depth knowledge of the market and can help you navigate increasing rates.
  • He saves you time by shopping for the best rate for you.
  • The rate is not the only important thing which is why he makes sure to negotiate the best loan conditions for you.
  • He protects your credit by using just one application compared to multiple ones you will do on your own.
  • Gives personalized advice and support tailored to your needs.

Compare mortgage rates FREE with over 20 lenders in Quebec

Free mortgage broker services for your mortgage renewal.

Do you have the time, knowledge, contacts, and expertise to find the best market rate? Unless it is your job, only an independent mortgage professional can do this with his vast resources.

Fill out the form below to receive free and no-obligation quotes from 3 qualified mortgage brokers in your area.

In today’s mortgage market where so many things can go wrong, it is to your best advantage to work with a specialist. A mortgage broker’s services are free so you have nothing to lose and everything to gain.

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