Mortgage refinancing. How to transfer your mortgage.
There is a lot to consider when you want to change banks and refinance your mortgage. Learn how to transfer your mortgage, why it is not enough to just compare mortgage interest rates, and when it pays off to refinance your mortgage despite the early repayment penalty.
The ideal time to refinance a mortgage
If your mortgage is about to expire, that is the time to begin thinking about continued financing for your home. Should you extend your mortgage with the same bank? Are you perhaps thinking about switching banks and refinancing the mortgage? Both are possible, provided you adhere to the required periods of notice. Even some fixed-rate mortgages have notice periods. They can be as long as six months. The only way to refinance a mortgage without incurring additional charges is to cancel it before its term expires.
Even if your mortgage is not due to expire until sometime in the future, you can start thinking about future financing now. The forward mortgage, also known as the Forward fix mortgage, can be taken out up to a year in advance. At Credit Suisse, you can even get one up to three years ahead of schedule. For this type of mortgage, the bank charges what is called a forward premium. A forward mortgage is sensible whenever you assume that interest rates are going to rise. That enables you to lock in currently attractive mortgage interest rates for the future. So, it can be financially worthwhile to take out a mortgage early in order to secure yourself a favorable interest rate.
Comparing mortgage interest and conditions
Before you refinance your mortgage, you can obtain offers from various financial institutions. That is because mortgage interest rates vary from one bank to another, and their fees differ just as much. It is therefore not sufficient to look at only their mortgage interest rates. Examine the offers carefully, and do not be deceived by a supposedly low interest rate. Some banks require you to pay a fee to extend or change your mortgage. Contract terms and conditions can be very different. You should also pay attention to the bank's experience. At Credit Suisse, you will be advised by certified Financing Experts based in your region and who know the market in detail.
Besides comparing offers from bank to bank, it is also essential for you to consider various mortgage models and terms. Both fixed-rate mortgages and more flexible LIBOR mortgages have pros and cons, and the reasons for choosing one or the other are individual. It is also important to compare the full range of banking services. Good advice takes into account your personal needs, future plans, and overall financial situation.
Refinance or extend your mortgage?
Anyone thinking about refinancing a mortgage should begin planning early and be aware of the applicable notice periods. Compare interest rates, contract terms and conditions, and the expertise of various mortgage lenders. Is it worthwhile to refinance, or might it possibly be better to extend the mortgage with your current bank?