When your mortgage term is almost up, it’s easy to just sign that renewal letter and carry on. But here’s the thing - this is your chance to make sure your next mortgage term actually works for you. Whether you’re with a bank, credit union or monoline lender, asking the right questions can help you save money, stay flexible, and align your mortgage with your future plans.
Here are the questions I recommend asking your lender before you renew:
1. What’s the interest rate you’re offering me and is that your best rate?
The first offer is rarely the best. Ask if there's any room to improve the rate or if they’re open to matching others. A small rate reduction can make a big difference over time.
2. What are my term options and what makes the most sense for me?
Terms can range from 1 to 5+ years. The right fit depends on your plans. Shorter term = more flexibility. Longer term = more stability. Make sure the lender walks you through your options.
3. Should I go fixed or variable?
This one depends on your comfort level and market conditions. Ask for a breakdown of both options and how they’d impact your payments.
4. How will my payment change?
Don’t guess - confirm exactly what your new payment will be based on the proposed rate and term.
5. Can I make extra payments or lump-sum payments?
Ask how much you’re allowed to prepay without penalty and whether you can put down a lump sum at renewal to lower your balance.
6. What happens if I break the mortgage early?
Life happens. Get clarity on what the penalty would be to break your mortgage mid-term - fixed and variable rate penalties are calculated differently, and some can be costly.
7. What if I move before the term is up?
Ask if your mortgage is portable, how it works, and what timelines or restrictions apply if you switch properties.
8. Can I change anything else - like payment frequency or amortization?
Want to pay bi-weekly instead of monthly? Thinking of extending or shortening the time you’ll pay off the mortgage? Renewal time is the moment to ask.
9. Are there any fees or paperwork involved in renewing?
If you’re staying with the same lender, it should be simple and free - but confirm. If you’re switching lenders, ask if the new one will cover transfer costs.
Bottom line: Renewal is more than a signature - it’s a chance to realign your mortgage with your current life.
Not sure where to start or what your options really look like? That’s what I’m here for. Let’s review your mortgage together and make sure you’re set up for success.