When should I start preparing for my mortgage renewal?

Start 120 days (4 months) before your maturity date. This gives you time to research rates, get competing quotes, and negotiate with your current lender. Most lenders send renewal offers 90 days before maturity, but by then you should already have alternatives in hand.

Is there a penalty for switching lenders at renewal?

No. At maturity, you can switch lenders with zero penalty. This is the one time you have full freedom to move. New lenders often cover your legal fees and appraisal costs too. The only exception is if you have a collateral charge mortgage, which can make switching more complex.

Should I choose fixed or variable rate?

Variable has outperformed fixed approximately 80% of the time over 25 years. However, fixed is better if you can't absorb payment increases, want certainty, or are unlikely to break your mortgage early. Variable carries much lower penalties if you need to break early.

How much can I actually save by shopping my renewal?

Typically $5,000-$20,000+ over a 5-year term. The difference between your lender's first offer and the best available rate is usually 0.25-0.50%. On a $400,000 mortgage, that's $4,500-$9,100 in interest savings over 5 years.

What if my financial situation has changed since I got my mortgage?

Renewing with your current lender typically doesn't require re-qualification, so they won't check income or credit. However, switching to a new lender requires full re-qualification. If your income dropped or credit score declined, staying with your current lender may be the better strategy this term.

What is a blend and extend?

A blend and extend lets you renew early by blending your current rate with today's rate. It avoids paying a full penalty. This is useful when rates have dropped significantly and you want to lock in a lower rate before your maturity date. Ask your lender if they offer this option.

Do I need to re-qualify if I renew with my current lender?

Usually no. Most lenders don't require a new stress test, income verification, or credit check for a simple renewal. This is an advantage if your financial situation has changed. However, switching lenders always requires full re-qualification.

Why should I use a mortgage broker for renewal?

Your bank has one option, their own rates. A broker has access to 65+ lenders and can get you competing quotes in days, not weeks. The service is free because lenders pay the broker. Even if you stay with your current lender, broker quotes give you negotiating ammunition.

Mortgage Renewal Guide Canada 2026

By Alex McFadyen, Mortgage Broker at Flow Mortgage Co.. Published September 4, 2026. Updated September 4, 2026.

Your renewal is the one moment in a mortgage when you can leave without paying a penalty. At maturity you can move to another lender for free, and many lenders will cover the legal and appraisal costs to bring the file over. The offer in your renewal letter is priced for the majority of homeowners who sign it. This guide covers how to read that offer, what to compare beyond the rate, and how to negotiate before your maturity date.

What happens at your renewal in 2026

Roughly 70% of Canadian homeowners sign the renewal letter their bank sends without shopping it. The rate on that letter is priced for those homeowners. Borrowers who push back, bring a competing quote, or move to another lender see a different number.

Most lenders mail a renewal offer about 90 days before your maturity date. By the time it arrives you want alternatives already in hand, which is why the work starts at 120 days.

How to read your lender's offer

Compare the offer against what is available across the wider market rather than against the rate you have been paying. The gap between a first offer and the best available rate is commonly 0.25% to 0.50%. On a $400,000 mortgage that is roughly $4,500 to $9,100 of interest over a 5 year term, and shopping a renewal commonly saves $5,000 to $20,000 across the term.

Rate is one term among several. Check the prepayment privileges, how the penalty is calculated, whether the charge is standard or collateral, and whether the lender will cover the cost of switching.

Fixed or variable at renewal

Variable has outperformed fixed roughly 80% of the time over the past 25 years. That record does not settle your file on its own. Fixed suits you better if a payment increase would strain the household budget, if you want certainty over the term, or if you are unlikely to break the mortgage early.

Variable carries a much lower penalty if you do need to break, which matters when a move or a sale is possible inside the term.

Renew or refinance

A renewal moves your balance into a new term with your current lender or a new one. A refinance changes the loan itself, which can free up equity for debt consolidation, renovations or an investment.

Refinancing at renewal can make sense when higher interest debt is costing you more than the mortgage rate, or when the property has gained enough value to change what lenders will offer. A refinance requires full qualification, so it is worth pricing before your maturity date rather than after.

Switching lenders at maturity

At maturity you can switch with no penalty. This is the one point in the term where you can move freely, and many lenders will cover legal fees and the appraisal to win the file.

A collateral charge can make a switch more involved, because the charge has to be discharged and re-registered. Switching also requires full re-qualification, so income and credit are reviewed again. Renewing with your current lender usually does not require a new stress test, income verification or credit check, which can be the better route if your situation has changed this term.

The negotiation playbook

Your bank can quote one set of rates, its own. We shop the file across 65+ lenders and bring back competing quotes, which gives you something concrete to negotiate with. Lenders pay the broker, so the service costs you nothing.

Even when you decide to stay, a competing quote in hand changes what your current lender will put on the table. Bring the number, ask them to match it, and get the revised offer in writing before you sign anything.

Your 120 day countdown

Start 4 months out. At 120 days, request your payout statement and confirm your maturity date, balance and current rate. At 90 days, gather competing quotes and hold a rate. Many lenders can hold a rate for 120 days, so an early hold protects you if rates rise before maturity.

At 30 days, confirm the paperwork is complete so the renewal or the switch funds on your maturity date without a gap in coverage.

Frequently asked questions

When should I start preparing for my mortgage renewal?: Start 120 days (4 months) before your maturity date. This gives you time to research rates, get competing quotes, and negotiate with your current lender. Most lenders send renewal offers 90 days before maturity, but by then you should already have alternatives in hand.
Is there a penalty for switching lenders at renewal?: No. At maturity, you can switch lenders with zero penalty. This is the one time you have full freedom to move. New lenders often cover your legal fees and appraisal costs too. The only exception is if you have a collateral charge mortgage, which can make switching more complex.
Should I choose fixed or variable rate?: Variable has outperformed fixed approximately 80% of the time over 25 years. However, fixed is better if you can't absorb payment increases, want certainty, or are unlikely to break your mortgage early. Variable carries much lower penalties if you need to break early.
How much can I actually save by shopping my renewal?: Typically $5,000-$20,000+ over a 5-year term. The difference between your lender's first offer and the best available rate is usually 0.25-0.50%. On a $400,000 mortgage, that's $4,500-$9,100 in interest savings over 5 years.
What if my financial situation has changed since I got my mortgage?: Renewing with your current lender typically doesn't require re-qualification, so they won't check income or credit. However, switching to a new lender requires full re-qualification. If your income dropped or credit score declined, staying with your current lender may be the better strategy this term.
What is a blend and extend?: A blend and extend lets you renew early by blending your current rate with today's rate. It avoids paying a full penalty. This is useful when rates have dropped significantly and you want to lock in a lower rate before your maturity date. Ask your lender if they offer this option.
Do I need to re-qualify if I renew with my current lender?: Usually no. Most lenders don't require a new stress test, income verification, or credit check for a simple renewal. This is an advantage if your financial situation has changed. However, switching lenders always requires full re-qualification.
Why should I use a mortgage broker for renewal?: Your bank has one option, their own rates. A broker has access to 65+ lenders and can get you competing quotes in days, not weeks. The service is free because lenders pay the broker. Even if you stay with your current lender, broker quotes give you negotiating ammunition.