Mortgage Renewal Calculator Canada

Is your mortgage term coming to an end? You're not alone—over a million homeowners will be renewing their mortgages in 2025, many facing higher interest rates than when they first signed up. With your mortgage payment most likely being the largest expense in your monthly budget, you want to be sure that you are getting the best rate and mortgage product available. Read on to learn more about how to calculate mortgage payments for renewal, how the mortgage renewal process works, and for tips on how to achieve the best outcome when it’s time to renew.

How to renew your mortgage

The simplest way to renew your mortgage is to sign the renewal form sent to you by your current lender in the last 30 days before the end of your mortgage term. But did you know that you don't have to renew with your current lender? You can usually get a lower rate by switching at renewal. In fact, walking into your current bank and re-signing at renewal often means leaving money on the table. Your existing lender has less incentive to provide you with the most competitive rates since they already have your mortgage business. Many lenders may also offer a cash bonus for clients switching at renewal time.

You may also want to think about whether you want the same type of mortgage that you had before, e.g. fixed or variable, short-term or long-term, etc. In today’s elevated interest rate environment, navigating your mortgage renewal wisely is more important than ever. Take a moment to watch the helpful video below, then read on for tips to secure the best mortgage renewal rate. A little effort now could save you thousands of dollars over the life of your mortgage.

Tips for renewing your mortgage

There are a number of steps that you can take to help ensure that when you renew your mortgage, you are getting the most favourable rate and terms possible. Here are some of the most important to keep in mind:

• Get started as soon as you can: Don’t wait for your lender’s renewal document, which typically arrives in the final 30 days of your term. Begin planning at least 120 days before your renewal date. This gives you ample time to evaluate your options, negotiate a better rate, and decide if you want to stay with your current lender or explore alternatives. Starting early also allows you to gather the necessary documentation if you choose to switch lenders and ensures your broker has enough time to process your application. Being proactive can save you money and stress.
• Carefully consider your financial and life goals: Your financial and life goals may have changed since you first took out your mortgage. Whether it’s a career change, planning for a child’s education, or preparing for a move, considering your goals and life events on the horizon helps you find the right mortgage product with the features that you need. For example, if you think you will have to move before your mortgage term is up, you’ll want to make sure you’ll be able to port your mortgage. Also, if you anticipate receiving a sum of money, such as inheritance, in the future and intend to pay off your mortgage, exploring open mortgage options may be a good idea at renewal time.
• Make a list of your mortgage needs: Make a checklist of the features and terms that matter most to you in a mortgage. These features can include portability or the ability to make lump sum pre-payments without incurring penalties. Having clear priorities will make it easier to compare offers and select a mortgage that aligns with your financial strategy.
• Use a mortgage broker: Save yourself the time and effort of going from lender to lender to try to get the best rate. A mortgage broker can serve as your one-stop shop, and is able to provide you with information on numerous lenders, as well as expert, personalized advice at no cost to help you make the right decision. A mortgage broker can also help you obtain a rate hold, which allows you to lock in a mortgage rate for up to 120 days, giving you time to continue your search with the peace of mind that you’ve secured a good rate. If a lower rate is available at the time you’re ready to sign, you will be offered that lower rate.
• Don’t be afraid to ask for a better rate: Your current mortgage lender will likely make it very easy for you to renew, and may be banking on the fact that you’ll just sign your agreement letter without considering your options for the sake of convenience. Rarely is the renewal rate that your current lender offers you the best rate available, and in Canada’s highly competitive mortgage market, there are typically lower rates available from other lenders. In today’s rising rate environment, negotiating for the best rate possible is more important than ever.
• Finalize your renewal: Once you’ve evaluated your options, secured the necessary documentation, and decided on a lender, aim to finalize your renewal well before your term ends. If you’re staying with your current lender, this may involve simply signing the renewal agreement. Bear in mind that, should you choose to switch lenders, you’ll want to have gathered all the necessary documentation to submit a new mortgage application (e.g. copy of renewal letter, proof of income, proof you own the property and proof of property insurance). If you are switching lenders, you’ll want to do this as early as possible, as it’s best to give several weeks for your application to be processed. Otherwise, you could end up being stuck with renewing with your current lender with a rate or terms that are less preferable.

Renewing vs. refinancing

A mortgage renewal is quite straightforward, and just what it sounds like – if you have not paid off the balance of your mortgage before the end of your mortgage term, you will need to renew it. As mentioned above, you can do this by simply signing the renewal form sent to you by your current lender in the last 30 days of your mortgage term, or you can shop around and renew with a new provider at conditions that are better suited to your needs. This is an ideal time to reassess your mortgage type, such as choosing between a fixed or variable rate, or adjusting the term length.

Refinancing, on the other hand, is quite different. If you refinance your mortgage, you are actually breaking your current mortgage contract. Reasons to refinance may include the desire to obtain a better mortgage rate, to access the equity in your home, or to consolidate debt, for example. While you can choose to refinance your mortgage at any time, be aware that it often comes with substantial penalties. It may be financially prudent to wait until the end of your mortgage term to minimize these penalties. However, this timing doesn't eliminate the distinction between renewing and refinancing; they remain two separate actions with different implications. 

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For further information, check out these helpful pages:

• Best Mortgage Rates in Canada
• Mortgage Default Insurance (CMHC Insurance)
• Open vs. Closed Mortgage: What's the Difference?
• Mortgage Terms Glossary