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  • Writer's pictureChad Eliason

Tips For Managing Higher Mortgage Payments For Those Renewing in 2024

Is your upcoming mortgage renewal the cause of additional stress for you? Here is my take; you know it’s coming and you know rates are likely higher than when you first got your mortgage, so the best way to help mitigate some of this stress is to acknowledge it is coming and start to plan now. Here is how:

  • Get an idea of what rates will be once you renew, and start planning how you will handle it. Check in with your current budget and see if there is any wiggle room for changes by looking at your fixed expenses (e.g. mortgage and car payments) versus your non-fixed expenses (e.g. streaming services, takeout food). Can you cancel something or cutback somewhere?

  • Understand your prepayment options. If possible, make prepayments before your renewal. This will reduce your mortgage balance, and therefore, the amount you will need to pay at a higher rate.

  • Understand your mortgage renewal options:

1. Shop around - It is perfectly ok to renew with your current lender, but seeing what other lenders are offering could potentially save you money.

2. Use your prepayment privileges - If you can, consider paying off as much of your mortgage as possible prior to negotiating your next mortgage contract. Many lenders allow you to prepay a certain amount of your mortgage each year, either by increasing your monthly payment or by making lump-sum payments. If this is part of your mortgage contract and you have the available funds, making a prepayment or two could help make your renewal more manageable.

3. Re-amortize - Extending your amortization period at renewal can result in smaller monthly payments and make your mortgage more affordable, at least in the short-term. Consult a mortgage professional to learn more about this option and the risks vs. benefits of it, as you will want to carefully consider your long- term financial future with this option.

Most importantly, arrange to meet and work with a mortgage professional. I can help you explore and understand all of your options, working with you to find a realistic budget, and to formulate a plan to manage higher mortgage rates. Navigating this on your own can feel overwhelming and you don’t have to do it alone. Connect today!

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