Are you nearing the end of your contract with your present lender? Are you tired of paying through the nose for monthly repayments that are much higher than those that your friends have to pay (and they re in the same boat as you, mind you)? Or, do you simply need cash fast so you can get the roof fixed or the kitchen re tiled? There is an option for you: do a mortgage switch.
There are many reasons homeowners switch lenders but the simplest is this: money. If you do a mortgage switch, you can save a lot in interest payments, get the term reduced, or be offered a far more flexible mortgage that comes with features like payment holidays and overpayments.
If you really are considering a mortgage switch, know that there are many types of mortgages that you can switch to. Here are some of the most common, as well as the benefits of switching to a certain type.
1. Fixed.
With a fixed rate, you can be sure your repayment will stay the same for the period you and your provider agree upon. This period is usually pegged at 1 to 5 years.
2. Variable.
With a variable rate, your repayments can decrease or increase depending on market trends.
3. Discounted.
With a discounted rate, you can count on repayments being lower at least for the whole duration of the promotional period.
4. Tracker.
If you try switching to a tracker mortgage, your rate will go down or up depending on the benchmark rate.
Before you do a mortgage switch, ask questions. Find out what the advantages and disadvantages of each type are. Also, talk to your present lender and ask if the company is ready to cut you a more competitive offer. For all you know, they may be so anxious to keep your business that they will plunk down a more competitive deal just to keep you from switching!
Many homeowners mistakenly think doing a mortgage switch is complicated, but it s not. Switching is relatively quick and easy. So, don t be tempted to stay with your present lender just because you do not feel like exploring uncharted territory. Make it a point to periodically check if you are getting the best deal and if your present loan is structured in a way that suits your circumstance. You can do this by reviewing the mortgage statement which your present provider sends you annually. Go over
the payments you have made over the year
the interest you paid last year
the mortgage s remaining balance
the mortgage s remaining term
the cost of fully paying off the entire mortgage, plus whatever charges may be incurred in the process.
Gone are the days when you take out a mortgage and stay with the same provider or loan until it s fully paid off. Today, the market changes quickly, bringing with it new price adjustments and evolving interest rates. Make these changes work for you by switching mortgages whenever it benefits you.
Allegro Mortgages Corp. – Best Broker for All Your Financing Requirements
(416) 987 0008
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