How to lower mortgage interest rate?

I saved about $6,400!

Interest rates are low at this point in time.

What does this mean for you as a property owner?

If you have a mortgage then you can potentially renew your mortgage with a lower interest rate so your monthly mortgage payment decreases.

My old rate was 5.19% - crazy high - when you compare it to 1.80% that I renewed at back in December 2020.

This new interest rate of 1.80% (whoohoo) I locked it in for 5 years – meaning it’s a fixed mortgage.

Emailing the bank which took 5 mins - is saving me approximately $6,400 over five years.  The monthly payment decreased by just over $100 per month.

Now to help you do the same…

Firstly, locate a document called, “Statement of Mortgage Account (Last Year complete)” which is provided by the bank each year.  This statement will tell you what your current term and rate is.

Your bank is not going to phone you up to tell you to renew your mortgage –at least mine doesn’t so you will have to ask. 

The bank makes more money when you don’t get a lower interest rate.

See the script you could use when emailing the bank that holds the mortgage.

If you don’t have an email address of someone at the bank, then phone in to ask for an email address.

I always do things by email - when it comes to big money matters so I can decide without distractions.

Email scripts to be emailed separately and in order as needed:

If you can’t find your statement.

Email 1:

Could you please email the most recent “statement of mortgage account” you have?

Email 2:

When is my mortgage # up for renewal?

I would like to renew the mortgage at a lower interest rate without penalty.

 Now, if you can renew without penalty, then request the - fixed interest rates over different terms.

 Email 3:

Please email the current fixed rates over the different terms.

Then you decide which interest rate/term you want to lock-in. FYI: I did five years and the rate with this term is 1.80% so should be lower now as this was back in December.

My rational for only requesting the fixed rates right now: 

There are fixed and variable rates – I stuck to only requesting the “fixed interest rates” given we are in a very low interest rate environment and there is more of a risk of rates going up than down so I’m locking this sh*t in. See the chart on the 5 year fixed rates in Canada.

Whereas, variable rates are good if you think rates are currently high and going down over time, meaning you don’t want to lock in at a high rate.

Then you see what rate you want and how long you want to lock that baby in. But remember this action is if you are looking at keeping your house/mortgage for a long time.

If you need any help then please feel free to reach out. Good luck on saving some dough with this action!

Photo by Brian Babb on Unsplash