» March 11, 2024

FAQs: Mortgage Renewal vs Refinance: What You Need to Know

When it comes to managing your mortgage, it’s important to understand the difference between mortgage renewal and refinancing. At Lenders’ Choice Mortgages, we know that these are common sources of confusion for homeowners. In this blog, we will address a few of the most frequently asked questions to help you make an informed decision about your mortgage options.

mortgage paperwork

FAQ 1: What is Mortgage Renewal?

Mortgage renewal is the process of signing a new contract with your current lender for a new term. It can typically happen every few years, allowing you to renegotiate your interest rate and other terms. It’s essential to consider your options during a renewal to ensure you’re getting the best deal possible.

mortgage refinance paperwork

FAQ 2: What is Refinancing?

Refinancing involves replacing your existing mortgage with a new one, either with your current lender or a different lender. This can be a strategic move to take advantage of lower interest rates, access equity, or change the term of your mortgage. It’s crucial to evaluate the costs associated with refinancing to determine if it aligns with your financial goals.

family at home

FAQ 3: When Should I Consider Mortgage Renewal?

You should start exploring your mortgage renewal options several months before your current term ends. This gives you time to shop around for better rates and terms, ensuring you’re not rushed into a decision that may not be in your best interest.

man on phone

FAQ 4: When Should I Consider Refinancing?

Refinancing may be a suitable option if interest rates have decreased, your financial situation has improved, or you want to consolidate debt. However, it’s essential to assess the potential savings versus the costs involved in refinancing to determine if it’s the right choice for you.

Understanding the differences between mortgage renewal and refinancing is crucial for making informed decisions about your mortgage. Whether you decide to renew or refinance, Lenders’ Choice Mortgages strives to be the best mortgage brokers who set you up for success. Our team is here to help you navigate the process and find the best solution for your financial needs.

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