Mortgage Renewal Time

by Mike Holman

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My mortgage is coming due at the end of July and I decided to shop around to get the best rate I could. In the past few years I’ve been renewing with one year terms at TD Canada Trust where my mortgage guy always gave me reasonable rates which I verified by talking to other people I knew who were mortgage shopping. ING Direct website is also a good indicator of competitive mortgage rates. Last year I didn’t think I got a competitive renewal rate but I renewed anyways because of extenuating financial circumstances – 2 mortgages, maxed out line of credits, baby was due same week as the mortgage etc etc. This year I’m down to one mortgage and the LOCs are paid off so it’s time to go shopping!

I used a mortgage broker who was recommended by two different friends of mine. She gave us a quote of 5.19% for 5 years for a $190k mortgage with a LOC up to $250k. The LOC requires a lawyer to setup and there is a $500 cash back for the legal fee so I don’t have to pay it. I also asked if she would cover the $270 fee that TD is charging for allowing me the privilege of not renewing my mortgage with them and she agreed (sometimes you just have to ask). By way of comparison ING Direct had 5.24% for their fixed five year mortgage and TD (my current bank) offered a whopping 5.49% for five years. Almost a third of a percent is a steep price to pay for the convenience of staying with TD.

I feel good about putting in a proper effort to get a good mortgage rate. I wasn’t that concerned about what the exact value of the best rate, since there is nothing I can do about that, but I really didn’t want to sign up for a mortgage thinking that there was a better deal out there if only I had searched a bit harder.

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{ 3 comments… read them below or add one }

1 Alex Givant

Check today post from Canadian Capitalist, he talks about interest rates.

2 Telly

Our friends just signed a 5-yr (3 weeks ago) with Investor’s Group for 5.05%. I’m not sure if you need to be an investor with them (not recommended of course!) to get that kind of rate though.

3 FourPillars

Telly, I just heard back from another mortgage broker who came up with a 5.05% rate as well from Dundee. Had he not taken exactly one month to come up with the offer, I would have taken it.

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