{"id":976,"date":"2016-02-19T10:10:05","date_gmt":"2016-02-19T18:10:05","guid":{"rendered":"http:\/\/www.roryc.ca\/blog\/?p=976"},"modified":"2016-02-18T16:02:11","modified_gmt":"2016-02-19T00:02:11","slug":"moving-your-mortgage-between-lenders-in-search-of-a-lower-rate-can-cost-you","status":"publish","type":"post","link":"https:\/\/www.roryc.ca\/blog\/2016\/02\/moving-your-mortgage-between-lenders-in-search-of-a-lower-rate-can-cost-you\/","title":{"rendered":"Moving Your Mortgage Between Lenders in Search of a Lower Rate Can Cost You"},"content":{"rendered":"<p style=\"text-align: justify;\">OTTAWA \u2014 Homebuyers tend to shop around for the best mortgage rate they can find when first purchasing a property.<\/p>\n<p style=\"text-align: justify;\">But when renewal time comes around, chasing the best rate might not save enough to offset the costs of moving lenders.<\/p>\n<p style=\"text-align: justify;\">Frank Napolitano of Mortgage Brokers Ottawa says the cost of moving a mortgage at renewal time will depend on the type it is.<\/p>\n<p style=\"text-align: justify;\">For example, on a standard mortgage, the costs of moving may be minimal and the lender who is taking over the loan may be willing to absorb them.<\/p>\n<p style=\"text-align: justify;\">However, on a collateral mortgage, the fees will be more.<\/p>\n<p style=\"text-align: justify;\">A standard mortgage is registered for the actual amount of the loan, while a collateral mortgage allows a home to be used as security for more than one loan. The downside is that changing lenders with a collateral mortgage entails paying both discharge fees and new registration fees.<\/p>\n<p style=\"text-align: justify;\">\u201cWith a collateral mortgage you can\u2019t just move the mortgage from one institution to another without incurring either legal fees or title insurance fees,\u201d Napolitano says.<\/p>\n<p style=\"text-align: justify;\">\u201cTherefore the interest rate savings have to be in place in order for you to make it worthwhile to move from one institution to another.\u201d<\/p>\n<p style=\"text-align: justify;\">Napolitano estimates the costs to move a collateral mortgage can be close to $1,000 after they are all added up.<\/p>\n<p style=\"text-align: justify;\">If you have a home equity line of credit in addition to your mortgage, you very likely have a collateral mortgage.<\/p>\n<p style=\"text-align: justify;\">But even those who don\u2019t may still have one and it may be necessary to read the fine print on the mortgage or to call the lender to find out and determine what the costs of moving may be.<\/p>\n<p style=\"text-align: justify;\"><em>If it\u2019s 5 or 10 basis points, the savings may not be there<\/em><\/p>\n<p>To know if it is worthwhile to move lenders, you need to calculate what the savings might be compared with the cost of moving.<\/p>\n<p style=\"text-align: justify;\">\u201cIf it\u2019s five or 10 basis points, the savings may not be there,\u201d Napolitano says.<\/p>\n<p style=\"text-align: justify;\">\u201cIf we\u2019re talking a quarter of a percentage point, the likelihood is there that you\u2019re better off to move it from one institution to another.\u201d<\/p>\n<p style=\"text-align: justify;\">Barry Gollom, vice-president for mortgages and lending at CIBC, says while collateral mortgages can be more expensive to switch between lenders they offer flexibility in other ways.<\/p>\n<p style=\"text-align: justify;\">Collateral charges allow you to use the home as the basis for more than one loan and borrow more in the future more easily.<\/p>\n<p style=\"text-align: justify;\">\u201cBut what you can\u2019t do, as a rule, is do an assignment or transfer of a collateral charge from one institution to another institution,\u201d Gollom said.<\/p>\n<p style=\"text-align: justify;\">Gollom adds that whatever a mortgage borrower does has to make sense in the context of their overall financial plan.<\/p>\n<p><a href=\"http:\/\/business.financialpost.com\/personal-finance\/mortgages-real-estate\/moving-your-mortgage-between-lenders-in-search-of-a-lower-rate-can-cost-you-especially-if-you-have-a-heloc\" target=\"_blank\">Moving Your Mortgage Between Lenders in Search of a Lower Rate Can Cost You, Especially If You Have a HELOC<\/a> by Craig Wong The Canadian Press | National Post<\/p>\n","protected":false},"excerpt":{"rendered":"<p>OTTAWA \u2014 Homebuyers tend to shop around for the best mortgage rate they can find when first purchasing a property. But when renewal time comes around, chasing the best rate &hellip; [<a href=\"https:\/\/www.roryc.ca\/blog\/2016\/02\/moving-your-mortgage-between-lenders-in-search-of-a-lower-rate-can-cost-you\/\">read more<\/a>]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[9],"tags":[],"class_list":["post-976","post","type-post","status-publish","format-standard","hentry","category-mortgage"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.4 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Moving Your Mortgage Between Lenders in Search of a Lower Rate Can Cost You &#8226; Rory C Real Estate | Oakwyn Realty<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.roryc.ca\/blog\/2016\/02\/moving-your-mortgage-between-lenders-in-search-of-a-lower-rate-can-cost-you\/\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:title\" content=\"Moving Your Mortgage Between Lenders in Search of a Lower Rate Can Cost You &#8226; Rory C Real Estate | Oakwyn Realty\" \/>\n<meta name=\"twitter:description\" content=\"OTTAWA \u2014 Homebuyers tend to shop around for the best mortgage rate they can find when first purchasing a property. 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