Mortgage Renewal Services in Ontario

Key Takeaways: Your bank’s renewal offer is almost never the best rate available. Switching lenders at renewal is free in most cases because there’s no penalty when your term ends. Even a 0.5% rate difference on a $400,000 mortgage saves roughly $100 per month, or $6,000 over a 5-year term. A 15-minute call with us could save you thousands.

Every mortgage in Canada comes with a term, typically 5 years. When that term ends, your mortgage doesn’t disappear. You need to renew it, either with your current lender or with a new one. Your bank will send you a renewal letter a few months before maturity with a rate and terms. Most people sign it without a second thought. That’s a costly mistake.

Why You Shouldn’t Just Sign Your Bank’s Renewal

Banks count on the fact that most borrowers will take the path of least resistance and sign the renewal letter. The rate they offer is almost always higher than what’s available in the market. They know that switching lenders feels like a hassle, so they price their renewal offers accordingly.

Here’s a real-world example: a bank sends a renewal offer at 5.29% on a $350,000 mortgage with 20 years remaining. Through our brokerage, the same borrower qualifies at 4.29% with a different lender. The monthly savings is approximately $185. Over a 5-year term, that’s over $11,000 in savings, just for making a phone call.

Use our renewal comparison calculator to see what you could save.

The Renewal Process

Your lender is required to send you renewal documents well before your term expires. You’ll receive a renewal offer that includes the new rate and term options. You typically have 30-60 days to respond. If you don’t respond by the deadline, your mortgage may automatically roll into an open term at a higher rate.

This is where most homeowners make their decision. They see the letter, glance at the rate, and sign. What they should do is call a broker, compare the rate against what’s available in the market, and make an informed decision.

Switching Lenders at Renewal

Switching lenders at renewal is far simpler than most people think. When your term is up, there is no penalty for leaving your current lender. The new lender handles most of the paperwork, and the process feels more like a refinance than a brand new mortgage application. You’ll need to re-qualify (income verification, credit check), but if your financial situation is stable, this is straightforward.

Costs to switch are minimal. Some new lenders cover the legal and appraisal fees as part of the switch. In cases where they don’t, you’re looking at $500-$1,500 in total costs, which is easily recouped by even a modest rate improvement over a 5-year term.

How to Negotiate Your Renewal

Even if you don’t want to switch lenders, having a competing offer gives you leverage. Here’s the approach we recommend:

Step 1: When your renewal letter arrives, call us. We’ll shop the market and get you the best available rate from competing lenders.

Step 2: Armed with that number, you (or we, on your behalf) call your current bank and present the competing offer. Banks have discretion to lower their renewal rates, and they’ll often match or come close to a competitor’s offer to keep your business.

Step 3: Compare the two options. If the bank matches, you may choose to stay for convenience. If they don’t, switching to the better rate is usually the smarter move.

When to Start Planning Your Renewal

Start the conversation 4-6 months before your mortgage maturity date. This gives you enough time to shop rates, gather documents, and complete a switch if needed. Some lenders offer early renewal options 3-4 months before maturity without penalty, especially if you’re staying with the same lender.

Don’t wait until the last week before your term expires. Rushed decisions almost always cost you money.

Renew vs Refinance: What’s the Difference?

A renewal keeps your mortgage amount the same (or very close to it) and simply sets new rate and term. A refinance changes the mortgage amount, typically increasing it to access equity or consolidate debt. At renewal time, you have the option to do either. If your financial situation has changed and you need to access equity, restructure debt, or add someone to (or remove someone from) the mortgage, renewal time is the ideal moment because there’s no penalty involved.

Ready to compare your renewal options? Contact us or call 905-455-5005. We’ll tell you in 15 minutes whether your bank’s offer is competitive or whether you should be shopping around.