Another important point to consideris the renegotiation of your mortgage interest rates.
Imagine you want to renegotiate your home mortgage loan in order to benefit from lower interest rates. Here is a common scenario: you meet the consultant at your bank. After reviewing your financial situation, he goes to see his supervisor he returned to you after few minutes with a negative response:
“Sorry but we cannot do anything to renegotiate without making you pay a penalty. It would cost you more than $1600 if you want to renegotiate your rate which would decrease from 5.4% to 4.5% for a 5 years term.”
Imagine you still have over six years to pay with your current rate if you don’t renegotiate. You would ask the bank’s employee to calculate whether paying the penalty would be advantageous or not for you. In other words, you want to know if you would end up paying less by agreeing to pay the penalty.
Il m’a répondu qu’il me reviendrait avant son départ, car cela prend quelques calculs et nous avions d’autres points à discuter. He replied that I would before his departure, because it takes some calculations and we had other issues to discuss. He tells you he will answer you be email after calculation of home mortgage loan interest rates and penalty for renegotiating.
And finally, you receive an email that tells you the penalty would be of $2100 and not $1600, and it would not be profitable for you to pay the penalty for a lower mortgage rate…
You are not satisfied of this answer and you think: “The penalty will be the same for renegotiating with the same bank or to go to another bank!” And you know another financial institution offers 4.3% for fix 5 years term.
You can see with this other bank if it could be better with them (but don’t forget to consider other fees, like notary fees) and if you could have better service and consideration…
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