Personal Finance

Renew mortgage in advance

  • Last Updated:
  • Jan 17th, 2011 10:46 am
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Member
Jul 14, 2008
312 posts
94 upvotes
Montreal

Renew mortgage in advance

Hi all,

I have what may be a basic question: I signed for a 5-year mortgage with TD about 20 months ago, at 3.55%. I have been wondering the last few days about whether it is possible for me to renew my mortgage today at today's rate, which would then be valid until January 2016. The idea would be that this way, I would be lessening the risk of a significant rise in rates by the time I have to renew my current mortgage in the spring of 2014 (i.e. I'd have 20 additional months at a low rate). What do you think? Are the penalties for doing so really large in these circumstances?

Thanks a lot!
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Deal Addict
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Apr 6, 2008
1613 posts
125 upvotes
Toronto
Turpentine wrote: Hi all,

I have what may be a basic question: I signed for a 5-year mortgage with TD about 20 months ago, at 3.55%. I have been wondering the last few days about whether it is possible for me to renew my mortgage today at today's rate, which would then be valid until January 2016. The idea would be that this way, I would be lessening the risk of a significant rise in rates by the time I have to renew my current mortgage in the spring of 2014 (i.e. I'd have 20 additional months at a low rate). What do you think? Are the penalties for doing so really large in these circumstances?

Thanks a lot!

You have a very good rate and your mortgage is not coming up for renewal for over 3 years so you should not worry about this right now. However, there is no harm in talking to your bank and find out. Your bank would be more than happy to oblige. May be you end up getting the same rate OR a little higher rate than this and the bank would have your business with them for extra 20 odd months.

Should your bank asks for too much or does not offer good rate, then I would suggest leaving the rates and term as it is.
Pramod Chopra
Mortgages and Investments

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