- Switching lenders at maturity carries no prepayment penalty.
- Start comparing mortgage renewal rates 120 days out; many lenders hold a rate that long.
- On a $412,000 balance, 0.85% lower saves about $194 a month ($16,766 in interest over 5 years).
- Uninsured straight switches at renewal no longer need to pass the stress test at federally regulated lenders.
When should I start shopping my mortgage renewal?
Start about 120 days before maturity. That gives time to compare bids, lock a rate hold and complete a switch without pressure. Federally regulated lenders must send your renewal statement at least 21 days before the term ends, which is often too late to shop properly.
| When | What to do |
|---|---|
| 120 days before | Post your renewal and get bids; many lenders hold rates up to 120 days |
| 90 days | Compare up to 4 bids side by side; ask about fees and prepayment |
| 60 days | Choose a lender, send documents, book the appraisal if needed |
| 21 days | Your current lender's renewal letter arrives; you already have options |
| Maturity | New lender pays out the old mortgage; no penalty |
Can I switch lenders at renewal without a penalty?
Yes. A prepayment penalty applies only when you break a mortgage before the term ends. At maturity the contract is over, so moving to another lender costs no penalty. You may pay a discharge or transfer fee to your current lender, and legal or appraisal costs; many bidders cover these on a straight switch, and each bid says who pays.
| Cost | Typical range | Who often pays |
|---|---|---|
| Discharge / transfer fee | $200–$400 | You (some new lenders reimburse) |
| Legal or title | $0–$1,000 | New lender on many switches |
| Appraisal | $0–$500 | Often waived under 65% loan-to-value |
| Prepayment penalty | $0 at maturity | Not applicable |
Ranges are typical for 2026 and vary by lender and province; each bid lists its own costs.
How much can a lower mortgage renewal rate save?
On a $412,000 balance with 25 years left, a renewal offer of 4.89% costs $2,370.48 a month. A bid at 4.04% costs $2,176.15. That's $194.33 a month and $16,766 less interest over a 5-year term. Change the numbers below to see your own savings.
Do I need to pass the stress test at renewal?
Not for a straight switch of an uninsured mortgage at a federally regulated lender: since November 21, 2024, OSFI doesn't require the stress test when you move the same balance and amortization to a new lender at renewal. Adding money, extending the amortization or refinancing brings the stress test back. Insured mortgages have always been able to switch without requalifying in most cases.
Renewal vs refinance: which do I need?
Renew if you only want a better rate and term on your current balance. Refinance if you want to borrow more, change who is on title, or extend the amortization. A refinance means new qualification, legal costs and, mid-term, a penalty. Use the renewal vs refinance calculator to compare.
Frequently asked questions
What happens at the end of my mortgage term?
Your lender sends a renewal offer. If you do nothing, many lenders auto-renew you, sometimes into a short open term at a higher rate. Shopping before maturity avoids that.
Can I renew my mortgage early?
Many lenders allow early renewal within 120 to 180 days of maturity without a penalty, but only with them. Switching lenders early usually means a penalty.
Will my lender match a better renewal bid?
Often. Your current lender can post a retention bid on MortgageBids.ca like any other lender.
Is the mortgage renewal process different in Quebec?
The rate shopping is the same; a switch is completed by a notary instead of a lawyer.
If your term ends in the next four months, the decision in front of you is simple: accept the renewal letter, or let lenders bid against it first.
- FCAC: Renewing your mortgage (checked October 7, 2026)
- OSFI: Guideline B-20, residential mortgage underwriting (checked October 7, 2026)
- FCAC: Mortgage prepayment penalties (checked October 7, 2026)
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