What’s the difference between a Mortgage Renewal vs Mortgage Refinance?

One of the biggest questions in mortgages is what’s the difference between a mortgage renewal vs mortgage refinance? This short article will provide you with a quick overview of the details and who each mortgage type is targeted towards.

Mortgage Renewal

A renewal typically happens on the maturity or ‘renewal date’ of your existing mortgage term, although early renewals are possible too. It involves a ‘continuation’ of the mortgage amount owed and amortization remaining. What we consistently provide on the maturity/ renewal date is a better rate (fixed or variable), and the best fine print terms and conditions.

Benefits:

  • Some of the lowest market rates apply.
  • No fees, legal fees or appraisal cost for most renewals.
  • Innovative renewal strategies available, not offered by our competition.
  • A straight forward, fast transaction that can easily save you thousands of dollars.

Who is a mortgage renewal best for?

A mortgage renewal is best suited for those not wanting to access additional funds for debt consolidation or other purposes. The renewal involves a smaller legal process and often results in a mortgage rate that is 0.10% – 0.20% lower than a mortgage refinance rate.

Mortgage Refinance

With a refinance, we are paying out your existing and ‘restarting’ your mortgage. Therefore more options exist regarding the size of the new mortgage and potentially reducing payments. Typically a refinance is used to lower the interest rate AND pull out home equity at some of the lowest market rates.

Benefits:

  • Access your home’s equity at a low fixed or variable rate for renovations, debt consolidation, investment or any purpose!
  • Can happen any time during the term – at or before the renewal date.
  • In many cases, the appraisal fee and legal fee can be covered.
  • Ultimately it’s not mortgage renewal vs refinance, but instead, which makes the most sense for you.

Who is a mortgage refinance best for?

A mortgage refinance is suited for those looking to consolidate debts and/or to pull out additional funds for home improvements, investing or any other purpose.

Book a meeting with Altrua financial today for lower rates, cash back options with an emphasis on quick funding.