By: Robert Clancy
Mortgages & Interest Rates
Hi,
below are some reason why you should always check in with your mortgage broker before signing any renewal agreement with a bank. You do not have to renew with your current lender at renewal time. Your mortgage contract is open again and you can go elsewhere.
| TD Canada Trust: | Renewal letters are sent out and the rate offered is the same as what was offered on the previous term. |
| CIBC: | Renewal letters are sent out at posted. If client signs they get the posted rate. If they go to the branch they can negotiate. |
| Scotia Bank: | Renewal letters are sent out at posted. Client is required to go to the branch to sign, at that point they may offer a discount if client asks. |
| BMO: | Renewal letters are sent out at posted. If client signs they get the posted rate. If they go to the branch they can negotiate. |
| Royal Bank: | Renewal letters are sent out and the rate offered is the same as what was offered on the previous term. |
| HSBC: | Renewal letters are sent out at posted. |
Explanation: The major banks are currently renewing 80 to 90% of the mortgages they hold and of that 80 to 90% they are renewing the majority at posted rates. Paying posted rates will cost the client over $18,000 in additional interest in just 5 years on a $250,000 mortgage amortized over 25 years. That is a lot of money that does not need to go to the major banks, especially when you consider there is over $250 billion worth of mortgages renewing this year!