The Ultimate Guide to Switching Mortgage Lenders

Got Your Renewal Letter?

Switching mortgage lenders might seem daunting, but it could be one of the smartest financial moves you make. Whether you're looking for a lower interest rate, better service, or more flexible terms, there are plenty of reasons to consider making a change. We specialize in helping clients like you navigate this process with ease.

Want to find out more? We offer a no-obligation consultation to determine the optimal time to switch and save thousands. Contact us today for more information!

Determine Whether Switching is Right for You

My mortgage costs are too high. When should I start thinking about switching lenders?

Although you can switch lenders at any time, most people plan to switch about 3 to 6 months before their mortgage term expires due to potential penalties. However, when interest rates drop significantly, such as in 2020, the savings from breaking the current mortgage term may outweigh any potential penalties. A mortgage specialist can help you determine the best time to switch.

What are other reasons for switching?

Maybe you plan to pay off your mortgage soon but your lender doesn't offer a short term mortgage option. Or if you want to change your pre-payment policies because you anticipate extra income in the next few years. Or you might want to change the terms or repayment interval of your mortgage. There can be a large variety of reasons for switching beyond simply rates. We can help break down your current mortgage situation into an easy-to-understand format so you can make a decision that's right for you.

Will shopping around with a mortgage agent affect my score?

To secure the best rate for you, we need to pull your credit report is necessary, however this has minimal effect on your credit score. That said, using a mortgage agent usually results in less credit pulls, as the mortgage agent is able to reuse the same credit report to shop around, rather than requiring multiple credit pulls if you decide to apply to different banks on your own.

Step-by-Step Guide to Switching Mortgage Lenders

1. Evaluate Your Current Mortgage

Start by reviewing your current mortgage terms. Understand your interest rate, payment schedule, and any penalties for early repayment. This will give you a clear idea of what you're currently dealing with.

2. Research Potential Lenders

Once you know where you stand, it's time to explore your options. Compare interest rates, terms, and services offered by different lenders. Remember, the lowest rate isn’t always the best deal—consider customer service and flexibility, too, especially whether you can leave your mortgage in the future.

3. Get a Mortgage Pre-Approval

Before making any decisions, it's wise to get pre-approved by the new lender. This step shows you exactly what you qualify for, making it easier to compare offers. At SamWise Mortgages, we help you through the pre-approval process, ensuring you have all the information you need.

4. Calculate the Costs

Switching lenders isn’t free. Consider potential costs such as discharge fees from your current lender, legal fees for transferring the mortgage, appraisal fees for your property. However, don’t let these costs deter you—often, the long-term savings far outweigh the upfront expenses.

5. Apply and Make the Switch

If you’ve done your research and the numbers add up, it’s time to apply for the new mortgage. Once approved, your new lender will take care of paying off your old mortgage and setting up your new one. We’ll be with you every step of the way to ensure a smooth transition.