The term “mortgage switch” seems daunting. This is especially true for someone who is not an expert in the field of mortgage – Toronto or elsewhere. Blame it on people who want to use jargon in order to confuse the layman.
To be truthful about it, a mortgage switch need not be complicated. It is, in essence, the process of transferring one mortgage loan to another. More often than not, this procedure involves two lenders. But sometimes, the opposite is true, especially if your current lender can provide better terms to your home construction loans texas.
It’s All About the Money
What makes a mortgage switch attractive? Why is it that when you search the term, Google returns with more than 12 million results?
The main reason why people get a mortgage switch is the money. They “transfer” a loan in the hope of saving up a few dollars, especially on the interest rate department. After all, any mortgage – Richmond Hill, for example – involves the borrowing of money. When you are borrowing money from someone else, you want to get the best possible deals. So if an opportunity arises when you can get that, who are you to immediately turn your back away from it?
So when is a mortgage switch ideal? Let’s look at some of the instances that warrant this financial option:
- When you are presented with a better deal.
In any case, your goal should be to get the most competitive mortgage deal possible. If, upon reviewing your financials, you feel that you’ve been robbed of the opportunity to take advantage of a better deal, then you should start shopping for lenders and consider a mortgage switch.
Sooner or later, you’ll find someone that will provide you with lower interests – given that the market rates are always fluctuating. When you do, take the time to check out that more attractive offer. This is not to say that you should immediately jump ship, rather, this just means that broadening your horizon to other lenders will not hurt. Sometimes, it could even be the best favor that you’ve done for yourself.
- When you want a better service.
Sometimes, a mortgage switch is not entirely about the money; it could also be about service. After all, who wants to deal with an inhuman lender? No one, right? Why should you let yourself be enslaved by an unfriendly lender when the market is peppered with thousands of other lenders who would be more than willing to be of service to you?
- When your special deal expires.
More often than not, a mortgage comes with a special deal – for instance, a two-year fixed rate mortgage. This means that on the first two years of payment, you will pay a fixed amortization fee. After two years, lenders then charge you with the standard variable rate. This rate is not always the most competitive.
Therefore, to make the most out of your mortgage, consider a mortgage switch when that special clause in your contract comes to an end. You’ll be surprised at the hundreds of dollars that you can save out of this small yet informed decision.