A mortgage transfer is when a home owner switches their existing mortgage to a new lender but is not adding on any additional funds (penalties, discharge fees, accrued interest, legal fees do not apply). In this scenario, someone will typically switch their mortgage at maturity for a better interest rate and mortgage product or switch prior to maturity and cap penalties into the new mortgage. Different rules and guidelines apply, depending on the mortgage product and lender so it is very important to talk to a mortgage professional to navigate you through the process.
A mortgage switch/transfer can be extremely beneficial because in most cases the legal fees and appraisal costs are paid by the new lender and the mortgage remains insurable, meaning a lower interest rate for the borrower. Many home owners may not even realize they are eligible for a mortgage transfer but instead are told to refinance which can lead to unnecessary costs and higher interest rates.
Mortgage Renewal time is sometimes the best time for home owners to check their Mortgage financing options. This is because making changes to your Mortgage at Renewal or maturity means no penalties will be charged.
In most cases homeowners will receive a Mortgage Renewal statement from their existing lender up to 6 months prior to maturity, with rate quotes higher then what the market is dictating.
Our Team shops various lenders to give homeowners the best mortgage rate and solution at Renewal time.
Furthermore, if the borrower is offered a great rate from their existing lender, then the team will advise them to stay with their lender. We want to be 100% transparent at all times and provide our clients with unbiased advice regarding Mortgage Renewals.