Should You Sell and Buy Now or Wait for Your Mortgage Renewal?

Many homeowners believe they must wait until their mortgage comes up for renewal before selling their home. That is not always the case.

If your current home no longer meets your needs, it may be worth looking at your options now. The right choice depends on your mortgage, your plans, and the cost of making a change.

Reasons to Sell and Buy Now

You may not want to wait if:

• Your family needs more space
• You want to downsize
• You are moving for work or family
• Your monthly housing costs are becoming difficult
• You found a property that better fits your lifestyle
• Your current home has strong resale value

Waiting for renewal could mean staying in a home that no longer works for you. Home prices and interest rates may also change while you wait. There is no guarantee that waiting will save you money.

What Happens to Your Current Mortgage?

Selling before renewal does not always mean paying a large penalty.

You may have a few options:

• Port your mortgage: Some lenders may let you move your current mortgage, rate, and remaining term to the new property.
• Blend your mortgage: If you need more money for the new home, the lender may combine your existing mortgage with new funds at a blended rate.
• Pay the mortgage penalty: In some cases, paying the penalty may still make sense if the move improves your overall finances.
• Use the sale proceeds: Equity from your current home may help with the down payment, closing costs, or paying off other debt.

Mortgage penalties can vary greatly. Fixed-rate and variable-rate mortgages are often calculated differently. Your mortgage contract and lender rules will matter.

Reasons to Wait Until Renewal

Waiting may be the better choice if:

• Your mortgage penalty is high
• Your renewal date is only a few months away
• Your income or credit needs time to improve
• You need more time to save for the down payment and closing costs
• Your current mortgage cannot be ported
• You are not sure where you want to move

A renewal date can create a clean time to review lenders and mortgage options. However, it should not be the only reason you delay a move.

Compare the Full Cost

Before deciding, look at the full picture:

• Expected sale price
• Mortgage balance and penalty
• Realtor and legal costs
• Down payment for the next home
• New mortgage payment
• Property taxes and utilities
• Moving and renovation costs
• Whether your mortgage can be ported

The lowest mortgage rate is not always the best answer. A mortgage with good porting and prepayment options may offer more value when your plans change.

Let’s Review Your Options

You do not need to wait for renewal to start planning. I can review your current mortgage, estimate the cost of selling early, and compare it with waiting until renewal.

A review gives you real numbers so you can make a confident choice.

To learn more about renewing your mortgage, please reach out to Patricia 403.875.2969

Visit our website at www.unbeatablemortgages.ca

Patricia McKean, a Lead Planner with the Unbeatable Mortgage Team at Mortgage Architects in Olds, has over 20 years of experience in lending and has been successful in helping a number of our rural clients obtain mortgages in Alberta.

Mortgage Architects
Olds, Alberta
d. 403.875.2969     p.  403.637.0140     f.  866.465.2870­­
patricia.mckean@mtgarc.ca
PatriciaMcKean.ca­