Private Mortgage Renewals: How to Save Money on Your Next Term

Private mortgages are a great short-term financing solution, but when renewal time comes, many borrowers face unexpected costs—higher rates, fees, or both. Here’s what you need to know to make the best decision.

What Happens at Private Mortgage Renewal?

Private mortgages typically have 1-year terms, and at renewal, you may face:

✅ Renewal Fees – Lenders charge from $250 to 1.5% of the loan amount to renew.
✅ Rate Increases – Many lenders are raising rates by 2–4% at renewal.

Current Best Private Mortgage Rate: 5.75% for 1st mortgage and 8.9% for 2nd mortgage

Should You Renew or Switch Lenders?

Before automatically renewing, check if you qualify for:

1. A B-Lender Mortgage (Lower Rates, Longer Terms)

Rates from 4.9% (vs. private rates of 6–12%)
1-5 year terms (vs. 1-year private terms)
No tax returns needed – Just 12 months of business bank statements

2. An A-Lender Mortgage (Best Rates, If Eligible)

If your credit has improved or your income is more stable, you may now qualify for:

Bank rates (3–5%)
Longer amortizations (25–30 years)

Costs of Switching Lenders

Switching to an new lender involves:

Legal fees (~$1,500–$3000)
Appraisal fee (~$350–$600)
Lender fees for private or B lender (1%–2%), no fee for A lender.

But… If you save 2–4% in interest, the switch could pay for itself in months.

3 Smart Renewal Strategies

1️⃣ Negotiate with Your Current Lender

Ask for no fee renewal or rate match if you’ve been a good borrower.

2️⃣ Compare Multiple Private Lenders

Some offer lower renewal rates than others.

3️⃣ Plan Your Exit

Use the renewal period to improve credit/income and refinance later.

Need Help with Your Renewal?

As a mortgage broker, I help borrowers:
✔ Compare renewal offers (private, B, and A lenders)
✔ Negotiate better terms with existing lenders
✔ Save thousands by switching when it makes sense

Contact me before renewing—I’ll find you the best deal!

More information on private mortgages: https://www.ipotekacanada.com/index.php/private-mortgages

Mortgages for self-employed: https://www.ipotekacanada.com/index.php/mortgages-selfemployed

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