What are your mortgage renewal options in 2023?

If you’re a Canadian home owner, you might be approaching your mortgage renewal this year. This might mean your monthly payments will be increasing, to accommodate the several interest rate hikes we have seen in the last year. For many people, these higher payments are significant. What can you do if you’re worried about being able to afford a higher rate? We expect this will be a common question from home owners this year. Here’s our advice!

Increase your amortization period

The truth is there’s no getting around the fact that interest rates and mortgage payments are much higher than they were one year ago. However, there are a couple of ways you can combat this challenge. Once your mortgage is up for renewal, you can consider lengthening your amortization period. This is the timeframe it will take to pay off your mortgage. The longer your amortization schedule, the smaller your monthly payments will be in order to stretch them out to match that timeline. This means you can save some money each month, which is a good option if you’re concerned about making day-to-day purchases and paying bills in the short-term. The downside is that you will be paying off your mortgage for a longer period of time. You need to consider these pros and cons before deciding which path is best for you.

Consider debt consolidation

The term “debt consolidation” sounds intimidating, but it can help home owners who are struggling with their finances. When you consolidate your debt, you are combining all your debts into one lump sum payment. This means every month, you make just one payment, at one interest rate. Often, the interest rate will be lower than some of the current rates on your debts. It can also make your debt easier to manage if you’re only dealing with one payment. Home owners who successfully consolidate debt find they have an easier time making their mortgage payments, and they save some money along the way.

Debt consolidation is a fairly serious course of action, so it’s important to talk to a mortgage broker before making any decisions. 

Get in touch with us!

Speaking of mortgage brokers, we are your most valuable asset when dealing with your mortgage renewal! It’s common for home owners to renew their mortgage with their current lender, but we’re here to help you explore all of your options. We get to know you and your situation, and from there we can look at the products and lenders that fit your needs best. If you think you will be struggling come renewal time, or you’re already feeling strained, it’s important to reach out to us. We can get you on the path towards the best and most affordable mortgage plan for you!

Your mortgage renewal can feel confusing, but our goal is to make it simpler. Whatever your needs are, we have experience helping all kinds of clients find the right mortgage option. If you have any questions, get in touch with us at Clinton Wilkins Mortgage Team! You can call us at (902) 482-2770, or contact us here.