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Mortgage renewal is an essential milestone in the life of a mortgage. It is the maturation of its term leaving you, the borrower, with a choice to renew with your current lender or switch to a new lender. A mortgage renewal doesn't need to be at the end of a term, though the closer it is to the end of a term the better for you. An early renewal will result in a penalty by the lender for breaking the current term agreement.
Mortgage Renewal uses
Mortgage rates are now lower than the current rate you have on your mortgage
Just like an annual financial plan, you should review your mortgage regularly. Renewal time is the ideal time to reassess your options and re-examine your overall financial situation. Our mortgage professionals are available to answer any questions you have and to help you choose the best options and lender for you.
When renewing your mortgage the rate guarantee period can be critical. Some lenders provide a 30-day period and some 60 days to lock into your next term. Obviously the longer this period is the better it is for you, because if rates move after you lock in, you may miss out on the better rate.
This is where one of our mortgage brokers can help. We can arrange a rate hold for four months, this can beat your current renewal often by 90 days. This will give you rate protection in an increasing rate market.
At renewal, you have several options:
- pay off all or part of your mortgage
- change the term (the interval between renewals)
- change the amortization period (the time required to fully pay off your mortgage), or
- change the frequency of payments (weekly, etc.).
With this flexibility, you can adjust your regular payments to suit your circumstances, which may have changed.
Reasons to renew your mortgage
You want to renew early to lock in a better rate
When you break your mortgage contract in favour of renewing your mortgage at a new rate and term, you’re faced with a penalty charge to reimburse your financial institution for the lost interest income.
As a basic rule of thumb, the prepayment charge is based on three months interest or the interest rate differential (the difference between your present mortgage rate for the balance of your term and the current rate you want to take out), whichever is greater.
The amount of the prepayment charge will tell you whether or not you should renegotiate your interest rate.
Generally speaking, the shorter your remaining term the better the chance your prepayment penalty will be worth it in comparison to the savings generated with a better rate.
Ideally your mortgage term would be up for renewal in less than a year. The smaller the penalty the more attractive early renewal becomes.
On the other hand, the longer the term left on your mortgage, the greater the prepayment penalties, which makes early renewal less desirable. At Mortgage for Less we can calculate the costs versus the benefits of breaking your mortgage early.
Your current mortgage term is ending
If the terms and rate of your current mortgage are fitting your budget and lifestyle and your mortgage term is ending soon, a renewal will reinstate your mortgage contract for another term, allowing you keep your current mortgage without change.
It is as the name suggests, the opposite of a renewal, literally switching your mortgage from your current lender to a new one.
You can switch to a new lender for a variety of reasons: better mortgage, an adjustment to your payment, a better interest rate, an increase in financing and/or opening up your repayment options.
If your mortgage is up for renewal with a major financial institution, switching it to another lender is easy. Quite often other lenders will offer you a better deal. This can be done at no cost to you because the new lender wants your business and will pay for the legal and appraisal fees to do the switch.
You may have a discharge fee charged by your current bank/lender, however the money you save by switching frequently outweighs the costs.
You can switch to a new lender at anytime with a penalty, considering this a switch is best utilized at the end of your current mortgage term. Although there is a penalty if you break your mortgage term before its up, the cost can be outweighed by the savings that follow a better mortgage.
Required documents for a Mortgage Renewal
- You need to provide a copy of your driver’s licence, passport, or other government-issued photo ID (but not a Health card).
- SIN - Social Insurance Number (while not required but helpful)
Why is it required?
Identification is used to verify your identity. While it’s a measure for preventing fraud, it’s essential for us to properly fill out your mortgage application.
It’s also a requirement so a lender can provide you with funding.
Important things to note
- All ID text, photos and numbers must be clearly visible.
If your income is salary or wages, provide:
- A recent pay stub showing the pay date, pay amount, your name and the employer’s name.
- A job letter on a company letterhead detailing your start date, position, guaranteed salary/wages, and a human resources contact name and phone number.
If any of your income comes from a bonus, commissions, overtime, a contract, gratuities or investments:
- Provide the most recent two year’s Notice of Assessments (NOAs) from Canada Revenue Agency (CRA).
If your income is through self-employment, provide:
- The most recent two years of Notice of Assessments (NOAs) from Canada Revenue Agency (CRA)
- Your business license, articles of incorporation, or GST registration number
- Self-employed applicants may have to show two years of unaudited accountant-prepared financials, depending on the lender and circumstances
If you earn rental income:
- Provide a copy of each lease, as well as either:
- A Canada Revenue Agency T776 Statement of Real Estate Rentals
- or two years of T1 generals (personal tax returns)
- or two years of Notice of Assessments (NOAs) from Canada Revenue Agency (CRA)
If you earn Alimony/Child Support:
- Provide Notice of Assessments (NOAs) from Canada Revenue Agency (CRA)
- The full separation/support agreement
If on maternity/paternity leave:
- A job letter on a company letterhead detailing your start date, position, guaranteed salary/wages, and a human resources contact name and phone number
- Ensure your job letter shows the return date and salary/income upon return
Why is it required?
Income verification is required for your application so a lender can verify your ability to manage your mortgage payments.
Also provides essential information for us to assess your situation. Most of all helpful information to determine which mortgage product is appropriate for you.
Important things to note
It’s fraud if you falsify and/or exaggerate your income. Fraud for shelter is the most common form of mortgage fraud in Canada. Therefore we won’t tolerate this irresponsible and harmful behaviour.
It is important to be honest and precise with your income so that you aren’t getting a mortgage you can’t manage to afford.
Current Mortgage Statement
A mortgage statement is simply a document prepared by your current lender and provided to you upon request. This document will detail your current mortgage.
Your mortgage statement will show:
- your information,
- the current mortgage balance,
- the current interest rate,
- amount remaining on both the mortgage term and amortization,
- your payment amount
- and includes contact information for your mortgage holder
- it may also provide you with a history of your repayment
Why is it required?
This document is essential for the lender you apply to. As a document it allows a lender to assess your current mortgage and review your management of that mortgage.
Important things to note
Must show your name, property address, balance or original mortgage amount, and payment
Renewing vs Switch
We can help. We have the knowledge, tools and professional dedication to advise you on your mortgage options.
Give us a couple of details and we'll advise, with no obligations.
Have a question?
Feel free to send us an email with any questions you may have about the required documents for a mortgage renewal.
We'd be happy to help!
How to get started with a Mortgage Renewal
Read our mortgage guides
We have a variety of useful guides that are essential and helpful for all your mortgage needs and questions. We cover everything from basic mortgage concepts to the functions and components of a mortgage to in-depth mortgage guides and strategies.
We have a variety of informative and useful pages. Take advantage of the free resources we offer with convenient bookmarks for all your mortgage information needs.
Determine what you can afford
We have a few excellent options to determine what you can afford to borrow. We offer an easy to use Mortgage Qualifier Calculator. Simply input the required information and let our calculator give you an idea of how much you can afford to borrow.
If you want to get the most accurate idea of how much you can afford to borrow, contact us or fill out our online mortgage assessment form.
Get a mortgage assessment
Get your mortgage assessed by professional mortgage brokers. We'll assess and advise on a mortgage product right for your financial needs an goals.
Decide on a mortgage loan
There are a variety of mortgage types and purposes. Deciding on the best mortgage for you is essential to getting the most logical loan for your financial needs, goals and future.
If you don't know what you want or need in a mortgage, we can assess your finances and in consideration of your financial needs and goals, we'll provide the best mortgage and rate for you.
Contact us for advice
We can assess your situation and advise on a mortgage product that will meet your financial goals and needs into the future.
Contact us for mortgage consultation
We can be contacted by phone, email or directly through our website. We do consultations through email, phone and meetings. To begin a consultation fill out a form pertaining to your mortgage needs.
We've been helping Canadians obtain financing at the best terms and rate for 30 years and we'd be happy to help you get the best mortgage.
Fill out an online form
We have a variety of forms and applications at your disposal. We do everything from mortgage applications to mortgage assessments to helping to improve credit ratings.
How getting a Mortgage Renewal works
Fill out our online mortgage application
We assess your financial information
We chat about your mortgage financing options
We collect your required documents
We shop for your best mortgage and rate
We submit your application to a lender
You get approved for mortgage financing
We continue to advise and standby to guide
Determine your home equity
with a free Ontario property assessment
A summary of our mortgage service
We navigate the mortgage market for you. As professionals we shop for you and in doing so we provide proficient service and advice.
Nick and his staff were very efficient and helpful. Nick in my opinion went above and beyond what was required in arranging my new mortgage. This has been my experience over the past 25 years when dealing with Mortgage for Less and Nick specifically.
Nick Mitskopoulos was professional, trustworthy, efficient and proactive. His expertise as a broker was evident from the moment we met him. We had encountered 2 other brokers before but we decided to go with Nick because of his professionalism and sense of ethics. He was also patient and answered our numerous questions. We definitely recommend him as a mortgage broker. Keep up the good work Nick!
At no cost to you, we work on your behalf with your best interests in mind, until the mortgage transaction is closed and you are funded.
We asses your situation, advise on a mortgage product, find your best rate and provide you with options to customize your mortgage.
Nick was great to deal with. Professional, knowledgeable, polite and quick to answer any questions we had. Throughout the process from mortgage pre approval all the way through to closing day he stayed in touch making sure we had all the information necessary.
Would highly recommend Nick.
I have used Mortage For Less for all my mortgages since purchasing my first home nearly 15 years ago. From our first experience Nick has always been amazing at providing advice and negotiating great deals, and we have been a loyal customers ever since. Nick also jumped in quickly to help us work out a line of credit through our mortgage when we inquired a few years ago, and he provides interesting updates on the market. I plan on sticking with Nick for as long as I own a home.
We consider your financial needs and goals to provide a proficient service of strategic mortgage customization.
We provide advice before and after a mortgage. We're dedicated to answering and advising on all your mortgage inquiries.
What a pleasure it is to do business with Nick. I have used Nick as my mortgage broker several times now and wouldn't think of using anyone else. He is knowledgeable, professional and always timely on any questions or inquires I have. He makes you feel like you are a special customer through the entire process. Nick thanks again for all you expertise and making this a smooth transaction.
Much appreciated !
It's always been a pleasure to work with you. Everything was made very easy for us even though you are in a different province. I believe I always got a great rate without me having to negotiate with several different banks. All the work was done for me. Thank you.
We provide a continued service of advice to strategically save tens of thousands over the life of a mortgage.
Renew your mortgage with your current lender
Our mortgage application and pre-approval are simple, straightforward and don't require much information to begin consultation.
Want a consultation?
We've been advising on mortgages for 30 years and we've helped thousands of Canadians get approved for their mortgage financing needs. We'd be happy to help you with your mortgage renewal.