Don’t fret, you’re not alone. Every year the banks seem to refuse more and more clients the option to renew their mortgage. While it can put a tremendous amount of strain on you as a borrower the one thing you should do is address the problem immediately because once the mortgage reaches maturity the bank is going to demand repayment in full. Without the option of renewal with your current bank you will have to find an alternative lender to assist you with your mortgage financing.
While options are certainly fewer when faced with a dilemma of this nature you still have options. Most banks refusal to renew a mortgage is generally related to a poor repayment history. While this is not always the case it is a common theme. It will often be difficult to just switch banks, as most banks don’t want to take on another banks problem or what they perceive to be a problem. Many banks will want to see your previous repayment history and in some cases ask for a mortgage rating which represents a problem if this is the reason your current bank won’t renew you.
None of this may seem too promising but there are lenders in Canada that don’t place all of their credence on repayment history or for that matter credit. Some lenders still underwrite their mortgage with the spirit of “common sense” and factor in other conditions such as job stability and equity position. The problem for most borrowers is know who these lenders are so working with an experienced broker is key to navigating the complex renewal process when your bank won’t renew your mortgage.
While there is no specific formula or format to follow a good plan of attack is:
While the whole process can be a stressful one, you can ease the anguish by working with a mortgage broker that understands the ins and outs of your bank not renewing your mortgage. Don’t put the situation off, be upfront and open-minded and you will find that a good mortgage broker can make the process seamless.