Avoid Doing These 3 Things At Renewal

When your mortgage renewal notice arrives, it can feel like a simple formality. Many lenders send renewal offers several months before your term ends, making it easy to sign the paperwork and move on. However, your renewal is actually an important opportunity to review your mortgage and make sure it still fits your goals.

Here are three common mistakes to avoid when you receive your renewal notice.

1. Do not sign the first offer right away
It may be convenient to accept the rate your current lender sends you, but it is not always the most competitive option. Lenders often reserve their best rates for new applications or for borrowers who review their options. Taking the time to compare offers can potentially save you a significant amount of interest over your next term.

2. Do not assume your current lender is your only option
Many homeowners are not aware that they can switch lenders at renewal without penalties. In many cases, the new lender will even cover some of the costs associated with making the switch. Exploring options across multiple lenders can help ensure you are getting the best rate and terms available.

3. Do not miss the opportunity to review your strategy
Your mortgage renewal is the perfect time to revisit your financial goals. You may want to adjust your payment amount, access some of the equity in your home, or shorten your amortization. Taking the time to review your options can help ensure your mortgage continues to support your long term plans.

Instead of simply signing your renewal notice, consider it an opportunity to review your mortgage and make sure it is still working in your best interest.