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a photo of renewing your mortgage in BC paperwork
Date published
Post Categories Mortgage Renewals, Mortgage Tips

How Early Can You Renew Your Mortgage in BC?

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Are you considering renewing your mortgage in British Columbia, but wondering about the optimal timing? The process of renewing your mortgage can seem straightforward, yet there are nuances to be aware of, especially when it comes to timing. 

In this article, I delve into the question: How early can you renew your mortgage in BC. 

Understanding mortgage renewals.

Firstly, let’s clarify what a mortgage renewal entails. When your mortgage term reaches its maturity date, typically after a period of five years (but can be shorter or longer depending on what you decided on when you first got approved for your mortgage), you have the option to renew your mortgage with your existing lender or explore other options in the market. 

Renewing your mortgage presents an opportunity to reassess your financial situation, adjust your terms, and potentially take advantage of better rates or features available at the time.

Early renewal in BC.

In British Columbia, like in other provinces across Canada, there’s a common misconception that you can only renew your mortgage at its maturity date once you receive your mortgage renewal letter from the lender. 

However, this isn’t necessarily the case. You can actually start exploring renewal options much earlier than you might think.

The 120 day rule.

According to the Canada Mortgage and Housing Corporation (CMHC), one of the largest providers of mortgage insurance in Canada, lenders must provide borrowers with renewal offers at least 21 days before the end of their mortgage term. 

Here’s where the flexibility comes in: most lenders allow borrowers to lock in a new mortgage rate up to 120 days before the maturity date of their current mortgage. This means that you can secure a new rate up to four months in advance of your renewal date, providing you with ample time to explore your options, negotiate terms and ensure a smooth transition.

A photo of a mortgage broker's file folder that is full of paperwork for renewing client mortgages

If you’re close to your renewal date and are considering switching lenders to see what other rates are available, give me a call today. We can chat on the phone for just a few minutes and I can get the process started!

Benefits of early renewal.

Opting for an early renewal in BC offers several advantages:

  • Locking in a rate: By renewing early, you can secure a favorable interest rate before potential market fluctuations occur.
  • Peace of Mind: Early renewal provides you with the assurance that your mortgage terms are in place well before your current term expires.
  • Flexibility: You have more time to shop around, compare rates, and negotiate terms with different lenders, potentially leading to better outcomes.

Factors to consider.

While early renewal offers benefits, let’s chat about some factors to consider that we’ll discuss during the mortgage renewal process: 

Penalties: Some lenders may charge prepayment penalties if you renew too far in advance. We can go over all the penalties and discuss your best options. 

Market Conditions: We will keep an eye on interest rate trends and market conditions to determine the optimal time to lock in your rate. 

Financial Goals: Assess your long-term financial goals and whether early renewal aligns with your objectives.

Ready to renew?

If your mortgage is coming up for renewal in around 120 days or sooner, it’s time to start the process of renewing today! Give me a call or send me an email and we can go over your current mortgage, discuss your financial objectives and determine when the right time would be to renew your mortgage. 

We’ll discuss mortgage rates, amortization periods and whether to go fixed or variable. You can take all the guesswork and unknowns out of your mortgage, when you work with Mortgage Okanagan! Give me a call at 250-826-3111, apply on my website or contact me through my online contact form to start the process today.

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