Private mortgage renewal
February 3, 2025 | Posted by: Alex Vinarski
Private mortgages typically have a one-year term. While some private lenders will charge a fee to renew for another year, others may increase the interest rate after the first year. With the prime rate increase in the last year, more lenders are now increasing rates on renewal. Additionally, some lenders use variable rates, which can result in rates being much higher than the previous year.
Current best rate for private mortgage 6.49%.
Before renewing your mortgage, it's worth checking out your options. In some cases, clients may be able to get a mortgage with a B or even an A lender instead of a private lender. For example, if their credit has improved or their business has started to make more profit. B lenders typically look at the business income in the last 6-12 months for self-employed borrowers, with rates starting at 4.9% currently. No tax return required.
Switching a mortgage to a new lender comes with new legal fees, lender fees, and appraisal costs, but in some cases, it can save money in the long run and give you the option for a longer mortgage term.
