Real Estate

Mortgage Question

  • Last Updated:
  • Aug 26th, 2019 9:07 pm
[OP]
Deal Addict
Jul 22, 2019
1536 posts
1663 upvotes

Mortgage Question

I have my mortgage renewal coming up and was wondering if I can lower the monthly payments.

For example, let's say it's a $50,000 mortgage, can I renew that for another 5 years fixed on a 20 year term? Am I able to request for an $xxx.xx amount as a monthly payment? I'm assuming there's a "min" and "max" monthly payment which will determine how much interest etc... I pay over the term? If I understand this correctly?
4 replies
Deal Addict
Jan 15, 2017
4211 posts
3718 upvotes
Ottawa
The easiest way to lower your payment is to extend your amortization. If you originally signed a 25 year amortization with a 5 year fixed, for instance, right now you would be typically renewing into a 20 year amortization. You could, if you are eligible, refinance the mortgage into a 25 year amortization. The longer amortization should reduce your payment.

Generally no, you are not able to request a certain payment as your payment is based on the mortgage balance, interest rate and amortization.
Deal Fanatic
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Feb 2, 2014
9068 posts
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Toronto
simplypop wrote: I have my mortgage renewal coming up and was wondering if I can lower the monthly payments.

For example, let's say it's a $50,000 mortgage, can I renew that for another 5 years fixed on a 20 year term? Am I able to request for an $xxx.xx amount as a monthly payment? I'm assuming there's a "min" and "max" monthly payment which will determine how much interest etc... I pay over the term? If I understand this correctly?
If you refinance, meaning you extend the AM, rates will be higher and you may have to pay extra fees (ie legal fees).

Keep this in mind.
Kevin Somnauth, CFA
Principal Broker - First Toronto Mortgage - MA (Ontario #13176, BC #X301007)
Real Estate Salesperson - Century 21 Innovative
Deal Addict
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Mar 9, 2012
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Kitchener
simplypop wrote: I have my mortgage renewal coming up and was wondering if I can lower the monthly payments.

For example, let's say it's a $50,000 mortgage, can I renew that for another 5 years fixed on a 20 year term? Am I able to request for an $xxx.xx amount as a monthly payment? I'm assuming there's a "min" and "max" monthly payment which will determine how much interest etc... I pay over the term? If I understand this correctly?
Easiest way to reduce payments is to put a good chunk of money down at renewal time (or even now). For example, if your renewal should have been $50,000, but now is $40,000 because you put down extra money, your payments would be 20% less.

Your other option would be to convert the mortgage to a HELOC only. It's not a mortgage. This assumes your house has enough value for the bank to approve this. You only need to pay the interest, that's all.
Why can't we all just get along?
[OP]
Deal Addict
Jul 22, 2019
1536 posts
1663 upvotes
jeff1970 wrote: Easiest way to reduce payments is to put a good chunk of money down at renewal time (or even now). For example, if your renewal should have been $50,000, but now is $40,000 because you put down extra money, your payments would be 20% less.

Your other option would be to convert the mortgage to a HELOC only. It's not a mortgage. This assumes your house has enough value for the bank to approve this. You only need to pay the interest, that's all.
Oops. Sorry I realize I made a mistake. I do have a HELOC. Every year I was able to put down 20% and "modify" my monthly payments, but there was of course a min. and a max. which I totally understand. Just wasn't sure when I renew my HELOC if I can say $ xx.xx monthly payments since I was able to lower my monthly payments currently. I have a meeting with TD in a few weeks so I just wanted to udnerstand things before going in. Thanks all.

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