Up for Renewal with a COVID Rate? Here’s What to Know!
As the year progresses, many homeowners are nearing their mortgage renewal dates. These mortgages were often secured at the low interest rates available during the COVID-19 pandemic. Now, with current rates higher than those lows, there’s a natural worry about potential increases in payments.
A common misunderstanding is that if interest rates double, your mortgage payments will too. Thankfully, this isn’t true. While higher rates will increase the interest portion of your payments, the overall monthly payment increase is not directly proportional to the rate hike. This misconception can lead to undue stress, so it’s important to have accurate information as you approach your renewal.
If you find the new payment estimate too high for your budget, we have ways to adjust it. One practical option is to extend your amortization period. Spreading your loan repayment over a longer term can lower your monthly payments, giving you more financial flexibility without significantly changing your long-term plans.
Navigating mortgage renewals can seem overwhelming, especially in an unpredictable economic environment. But with the right knowledge and strategies, you can handle your renewal with confidence and keep your home both affordable and enjoyable.
If you’re up for renewal and anxious about rate increases, let’s discuss your options. Together, we can tailor a solution that suits your financial needs. Don’t let anxiety guide your financial choices—become informed and take charge of your mortgage strategy.