Are You Unsuccessful In Your Mortgage Renewal?

When your mortgage hits its maturity date, you will have to renew the outstanding balance for yet another term. You can do this repeatedly before fully paying off the mortgage. Before your term expires, your lender sends you a renewal offer via email. The new offer contains information on the new term and mortgage rates, with a slip on which you can sign and send back. However, as convenient as it may seem, your approval odds are never 100%. A great way to evade the inconveniences is switching best mortgage companies in Montreal. But, if your slip is denied, there is no need to worry. Let’s explore the possible options you may have if your slip is denied.

Reasons For Denial

While switching lenders is convenient, why not exhaust all available options before leaping out? A good reason to move on with your lender is that you won’t have to re-qualify. If you pay off all your mortgage payments during your term, your lender will not deny you the mortgage renewal application. They will still review your current financial situation to figure out whether you are creditworthy. They may even evaluate your current employment and income rates to weigh the scales. If your finances are questionable, the lender may choose to deny your renewal. It is good to negotiate to see if you can increase your chances of fast approval.

Contacting A New Lender

If your lender denies you the mortgage renewal, or you are in search for better terms out there, you may consider going to another lender. To find a new lender, contact a mortgage broker or agent. However, the downside is that you have to submit a new mortgage application for renewal.

Since the new lender does not know anything about your financial status apart from your outstanding mortgage balance, they will have to verify your income to ensure you meet the standard credit requirements for approval. This makes it even more difficult. Therefore, do not cut links with your current lender just yet.

Possible Solutions After Being Denied

Both your current and new lender may deny you renewals. If so, do not give up. You can try convincing them into accepting your terms. If you fail, just consider other options. For instance, if your “A” lender is a bank or credit union, branch out to “B” lenders. Typically, they may be bad institutional lenders and trust companies for cash-strapped individuals. However, lenders go with logic. Therefore, if your credit score is way below the reasonable standard, you will still miss out. But, don’t bow out. Private lenders can suit you best at this level so you don’t sell out your home. You will have to convince that private lender because they need an assurance too before approving your request.

Getting to the point where you will be forced to sell your home is never your only last option. It can only happen when your finances dwindle below the required standards. To evade this tragic situation, make sure you timely pay all your monthly payments and you will maintain your good credit score. If you religiously follow the rules, it will not be difficult to have your mortgage renewed for another term.

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