At MonsterMortgage.ca, we always refer to clients whose mortgage terms are ending as “free agents.” The term comes from the baseball industry and refers to players whose contracts are finished and they are able to negotiate new terms with any one of the 30 clubs in the market who will pay them the most money to jog up and down first base. In the mortgage free agency market, the goal is to negotiate the lowest rate and lowest payments, with any institution who is offering mortgages. Quite often, it is best to negotiate with your current lending institution. After all, you know them and they know you – and they should treat you well… but what if they don’t?
Recently, we are seeing signs of concern and desperation from some of the major banks in their approach to offering renewals to mortgage clients. This note came from a financial advisor at a major bank – MonsterMortgage.ca placed the client 5 years ago and the client forwarded the bank’s renewal email to us for review. It read:
“Hope you are doing well. I am writing to let you know that your mortgage is up for renewal on June 1st. I urge you to contact me as soon as possible as your rate will increase if you do not renew your mortgage before maturity.”
Now, rates as everyone knows, have been decreasing during this pandemic. We do see this type of sales tactic all the time and it is important to get third party advice on how to manage the process. Certainly, if your financial situation has changed either because of the closure of the economy or for other reasons, it may be best to renegotiate with your current lender. We can help with that. But if you’re in a position to look at other lenders, you may be surprised at some of the offerings. It is an aggressive market as new home sales and mortgages have stopped so we are seeing a very competitive rate environment in the renewal market. Some as low as 2.39% for 5 years. Remember that mortgage rates change every day.
You don’t need to do this alone. As always, MonsterMortgage.ca is here to assist and give independent advice. Give your mortgage agent a call or Monster at 416-480-0234.
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