Mortgage vs. HELOC
Mortgages often take the biggest chunk out of the paycheques of most Canadians. In fact, approximately 85 percent renew their mortgages with the same lender automatically because it's just easier that way. Taking the easy way out often means getting results that are not optimal. That's certainly the case when it comes to renewing mortgages. You should always shop around before renewing your mortgage for the lowest rates.
If you really want to get the best interest rates possible, you should start shopping around several months before you renew with your current lender. Give yourself four to six months to do your research and find the very best rate. Sometimes, sticking with the same lender might be the best option for you, so don't feel like you have to go to a new lender for the best rates. The best place to search is online. Our site is dedicated to compiling and comparing mortgage rates and should serve as the first step if you want to save money on your payments down the road.
Whether you decide to switch over to another mortgage lender or stay with your current one, you should never automatically accept the default rate. Experts recommend that you ask for a lower rate right off the bat. After all, it never hurts to ask. The worst that can happen is that you'll get 'no' for an answer. Those who don't mention anything are the ones losing out. Don't just focus on the rate either. There are other variables that can affect how much you ultimately pay, so try to negotiate on the rate type, payment schedule, amortization period, and more. If the only thing about your current lender that you're dissatisfied with is the rate, find a lower rate from a competitor, and ask your lender to match it.
Shopping for better mortgage rates can take a lot of time and effort, and some people simply don't have it. Others are hesitant to confront lenders and demand lower rates because they feel uncomfortable doing so. If either of the above is true for you, you always have the option to use a mortgage broker to represent you. The services of mortgage brokers are often provided for free as well, so there's no harm in asking for professional help.
If you want to save money on your mortgage payments, shop around. Studies show that even with a rate that's half a percent lower than you currently have, you could save $10,000 over the course of 25 years on a $150,000 mortgage.