By ordering an appraisal around the time of mortgage renewal, your lender will know just how much equity you have in your home, and how ‘safe’ their investment is.
This is the sort of thing we can expect more of in a weakening real estate market. Not that prices have fallen off a cliff or anything, but as a generality, prices overall are down from a year ago.
Bucking the trend — markets like Ottawa, Montreal and Belleville are pretty hot right now. And if you are shopping for a condo or townhouse in the GTA, you won’t find many bargains out there either.
Mortgage lenders want to understand the quality of their loan portfolios. Higher risk mortgages (for example, those with little equity or where the borrowers credit history is poor) are possibly going to be offered much higher mortgage renewal rates. Or… told to take their business elsewhere.
In late March 2018 I sounded an alarm bell about mortgage renewals here in Canada.
Related BLOG POST: MORE BAD NEWS FOR MORTGAGE RENEWALS
I said mortgage renewals were no longer routine or straightforward. This is a result of an international accounting standard called IFSR 9 which EVERYONE must comply with by year end 2018.
Meaning they had to come up with $42,000 just to stay with this lender. Not many people have that kind of money lying around!