The nesto Meter Quick Take: Everything You Need to Know About Saving Thousands on Your Mortgage Renewal

You know what our number one pet peeve is at nesto? It’s heartbreaking to see people miss out on saving thousands of dollars. After all, this is our brand’s goal, our reason for existence: helping you save money.

So, when we learned that 80% of Canadians stick to their primary bank during renewal season, losing thousands in potential savings, we knew it was time to change all that.

That’s why in today’s quick take, we’re going to walk you through why most people (like you!) aren’t shopping around for their renewal rate and tips to change that so you can save thousands, so you can see firsthand how simple it is to make the move (and make your wallet happy!).

The nesto Quick Take

If you’re like 91% of Canadians, you likely read reviews and look at prices before shopping; however, when it comes to a more long-term decision, like mortgage renewal, do you do the same? Considering only 14% of Canadians are switching mortgage lenders, it’s likely not.

Know you’re not alone, though. We even see this internally,  as the number of nesto users seeking to switch their mortgage remains steady year over year – there’s no increase, no decrease. It’s the same. 

So, why then, don’t people switch lenders when they can save thousands? 

Well, there are a multitude of reasons, really, from the likely suspects of being short on time to fear (which is one thing we will never be down with at nesto). 

Let’s go through those reasons now and bring clarity to the otherwise obscure process of renewals:

• Lenders make the most profit from renewals because no one negotiates it. Those who negotiate renewal rates often don’t do their homework, thinking they’re getting a great deal when in reality, they’re just getting a small discount from a bad deal already offered.
• Most people don’t know that it is 100% free to change lenders at renewal time. Mortgage specialists often claim that changing lenders incurs fees, expenses, or disadvantages – but this is usually not the case.
• All companies, but specifically mortgage companies, will offer their best foot forward to try and gain a new customer. Somehow, in 2022, Canada’s largest companies still treat new customers way better than existing customers.
• Rates are currently increasing at a pace similar to when Covid first crippled our ability to predict the future/market.
  • Since that time, it has become increasingly critical to discuss interest rates and mortgage holders. Taking a laid-back approach and putting it on the back burner will result in spending more than those securing renewals with a new lender today. We are talking about thousands of dollars.

What Are the Benefits of Switching Lenders?

Monetary savings that reduce your monthly payment. Plain and simple.

A majority of Canadians have spent their lives with one banking institution, and the result is that they are getting shortchanged. 

There is a financial tech revolution underway, redefining what value means to canadians. Whether you switch or not, doing homework will expose this value to you.

For instance, by working with nesto, 15% of our users renew their mortgage with us, and when they do, they are given the chance to change their mortgage rate. 3% of those who renew can get the best low variable or fixed rate, saving them big money on monthly payments. What’s more, we make sure to remind them of renewal time/their best rates, and the average user secures 4 months out from their renewal date — just one way nesto advisors are on your side.

Actionable Tips to Finally Switch Lenders

+ Get organized with your finances. This means reviewing your credit score to understand precisely what your number looks like and how to improve it. Lenders will want to know what your overall financial situation is, starting with this metric: your credit score.

+ Shop around. Start comparing rates early and shopping around with multiple mortgage lenders. If you know that your mortgage renewal is within a given year, the earlier you start, the better.

+ Ask for a better rate. Yep, it’s really that easy. Don’t settle. Push for a better rate. What you’re being marketed with your primary lender isn’t the best rate they can do. (If you want transparency and trust in this process, talk to nesto mortgage experts. We’re low from the get-go. No negotiation needed.)

Renewal Resources to Consider:

Mortgage Renewal Process | How to Renew Your Mortgage

Early Mortgage Renewal

4 Simple Tips for a Successful Mortgage Renewal

Here’s how you can benefit from refinancing your mortgage

Porting and Assuming Home Loans in Canada

Bank of Canada interest rate hike announced – Here’s why homeowners should remain calm