1. Interest Rates: This is likely the biggest factor for most homeowners. If you locked in a lower rate previously, today’s rates may seem higher, which can increase your mortgage payments. Check both fixed and variable rate options, as they each have their pros and cons depending on market conditions.
2. Current Financial Situation: Review your debt, savings, and income. If you’ve paid down some of your mortgage and reduced other debt, you may qualify for better rates. However, if your financial situation has worsened, there is no need to get anxious. There are still mechanisms that can help you secure the best terms for you. Talk to an expert to discuss your options.
3. Term Length: Did you know the Canadian government has expanded eligibility for 30-year amortizations? (Read full article here). Do you want to lock in for another 5 years, or are you more comfortable with a shorter or longer term? Shorter terms often have lower rates, but they may also mean going through the renewal process more often. Longer terms provide stability but may come at a higher cost.
4. Prepayment Options: If your financial situation has improved, consider whether you want to pay more than your minimum payment. Some mortgages allow lump-sum payments or higher monthly payments, which can help reduce the total interest you’ll pay.
5. Penalties and Fees: If you’re considering switching lenders to get a better rate, be sure to factor in any fees or penalties for breaking your current mortgage. These costs may negate the benefit of a lower rate. Our experts can provide you this information to help you make decisions.
6. Market Conditions: Keep an eye on housing market trends and economic forecasts. If interest rates are expected to rise, it might be worth locking in a fixed rate now. Conversely, if rates are expected to drop, a variable rate might save you money in the long run. Subscribe to our mailing list to stay informed!