Brokers More Important Than Ever
Nearly half of all existing mortgage in Canada will be up for renewal in 2018. Stated in a Financial Post article by Armina Ligaya, CIBC Capital Markets estimates 47% of all existing mortgages will need to be refinanced in 2018. All of this coming on the heels of rising interest rates and changes to key mortgage regulations.
With this renewal number hovering around 50%, almost double from previous years, big banks will be fighting hard to keep their clients and handle their mortgage- as they should. However, is staying with the bank you got your mortgage with 1, 2, 3, even 5-years ago in your best interest?
Think of the rising housing prices, the rule changes to back-end insured mortgages, the multiple stress tests as well as the implementing and removing of programs such as the B.C. Home Partnership Program. All of which has just happened in the past couple of years.
With all these changes, should you not be speaking with a licensed mortgage broker to determine what is in your best interest?
The options that are available through other lenders can be quite advantageous. From opening up Home Equity Line Credits with a big bank, to Manulife One Account access and the lowest interest rates available on Switch Mortgages where lenders will help compensate the administrative costs.
One of the more common scenarios we are seeing is people upgrading their homes with marriage, children, or promotions/relocation with work. Clients know it is happening in the near future but do not have an exact timeline. Wanting a 5-year fixed mortgage but worried about the possibility of upgrading after just 2-years, we usually suggest working with a Monoline Lender. Sticking with a Big Bank like CIBC or RBC and having this scenario happen could potential result in penalties of $10,000-$15,000 where that same penalty might only be $3,000 with a Monoline Lender.
It is always best to consult with a Dominion Lending Centres mortgage broker before signing your bank’s renewal letter. We offer free pre-qualifications, no client-relationship contracts, and credit assessments to see your eligibility on receive A-Rates, all without your credit score taking a hit.
– by Ryan Oake