The Mortgage Renewal Wave: How to Turn 1.2 Million Renewals Into New Listings

Welcome to the close more deals podcast. I'm your host, Scott Dillingham. Today, I'm gonna be talking to you about renewals. This is a major, major thing that's happening right now. And by you getting on top of this, and I'll explain why it's so important as well, but it can help you to close more deals.

So a lot of clients are currently up for renewal this year and next. They're calling it the renewal wave for a reason. And the challenge is is that pre COVID rates and even rates that were given during COVID because they shot down really low, they're so much cheaper than current rates. So what's happening is people are entering these renewals and their rates are going up, which means their payments are going up. It's making things harder for them to to carry.

Right? So there's roughly 1,200,000 Canadians that are up for renewal this year and next. So it's just massive, amounts of people. So the thing is is when you're up for renewal, there's there's a couple things. When you're up for renewal, you have to take the amortization that's left.

So what I mean by that is, say, you know, you started with a twenty five year and you renewed and maybe now let's say that you have, I don't know, fourteen years left. Right? Maybe you chose a one year, five year, whatever the options are, but you've got fourteen years left. So what happens is when you renew, your payment goes up because the interest rate goes up, but then you still have to keep that fourteen year period. So one of the things that we're doing to save clients money is obviously when we're looking at the renewal rates, we're checking all of what the lenders offer.

But then we're looking at, you know, if we do it and structure it as a refinance. We're not necessarily giving the investor or the client money out of out of pocket, but what we are doing is we're changing their amortization. So we can bring them back up to a twenty five or a thirty year amortization, lowering their payments to make this affordable for them. So you coming in with that suggestion to your clients, you're gonna be the hero. But here's how you, as a realtor, here's how you close more deals.

So there's gonna be a lot of clients that when they get their renewal monthly payment, it's gonna be unaffordable for them. Right? A lot of homeowners, when they buy their home, they're maximizing their debt ratios. So they're already maxed at the lower payment. So when the payment goes up, right, they're they're really struggling.

So the downsizing option, is there. Right? So touching base with your clients, letting them know that renewals, you know, it is going to raise their payment. If that's not an option for them, right, they can sell or downsize. They can speak to a mortgage professional like Lens City, where we will analyze and see if we can extend the amortization to improve their positive cash flow.

Or you know what? Maybe they can afford it. And then what we'll do is instead of just accepting the the the banks or whoever their lender is renewal, shop it around to also save money. Because there's many lenders that assume clients don't shop around. And when they give these renewal documents or these rates, they're not very aggressive.

So we can quite often help. Now sometimes they are. Right? I'm not saying every time they're not, but we've seen it a lot where they're not aggressive and we can help the client to save money. But you will come and become the hero for helping your client to save, especially if their payments are becoming unavoidable.

So look back. Think of your transactions that you've done. Right? Those transactions that are three to five years ago. This is the perfect people to reach out to.

Right? Because they're gonna be facing these higher renewal payments. So just touch base, check-in, see how it's going, and you'll be surprised, how many clients you'll be able to convert, and then referrals you're gonna get by doing that extra due diligence in helping them, when they need it. Because, right, nobody wants their payments to greatly increase on on their home, and that's what homeowners are up against the next two years. So, anyways, I hope this episode added value.

I hope you enjoyed it. If you did, like it, share it, follow, all that good stuff. Share with a friend. You you know? Anyways, thanks so much.

Look forward to seeing you next week. Take care.