Mortgage renewal coming up? Don't just sign the letter

Your renewal letter is not a bill you have to pay. It's an offer. And at the end of your term, you have more options than signing and sending it back.

Why start about 120 days before your renewal date

The Financial Consumer Agency of Canada (FCAC) recommends shopping around a few months before your term ends and not waiting for the renewal letter. A practical starting point is about 120 days out, because many lenders will hold a rate, or let you lock in an early renewal, for up to about that long. Rate-hold periods vary by lender, so check the terms of any offer.

Starting early also gives you time to sort out anything that could complicate a switch, such as a collateral charge or a change in income.

What your renewal statement has to tell you

If your mortgage is with a federally regulated lender, such as a bank, the lender must send a renewal statement at least 21 days before your term ends (and must tell you 21 days ahead if it won't renew you). The statement shows your balance at renewal, the interest rate, payment frequency, term, and any fees, and the offered rate can't go up before the renewal date. Credit unions in Alberta are provincially regulated and may follow different timelines, which is one more reason not to wait for the letter.

The rate in your letter is a starting point

FCAC notes you may qualify for a discounted rate that's lower than the one quoted in your renewal letter. Tell your lender about other offers you've received; you may need to show proof. Renewal is also a good time to review the rest of the mortgage: term length, payment frequency, prepayment options, and whether you want to pay it down faster.

One caution from FCAC: think twice before extending your amortization just to lower payments, because the extra interest can add up to thousands of dollars or more.

You can switch lenders at the end of your term

You don't have to renew with the same lender. Prepayment penalties apply when you move your mortgage before the end of the term; at maturity you can move without one. A few things to know:

• The new lender has to approve you. It may use different criteria than your current lender, so expect to provide income and property documents.
• Ask about costs. Switching can involve discharge, registration, transfer or assignment fees, an appraisal, and legal costs. In Alberta, registering a new mortgage at Land Titles is $50 plus $5 for each $5,000 of principal (fee schedule effective October 1, 2026). Ask whether the new lender will pay some or all of these.
• The stress test may not apply to a straight switch. Since November 21, 2024, OSFI exempts uninsured straight switches (same balance and amortization) from the minimum qualifying rate at federally regulated lenders. Borrowing more or extending the amortization changes this.
• Already insured? Tell the new lender. A new mortgage insurance premium may apply only if the loan amount increases or the amortization is extended.
• Collateral charges take longer. If your mortgage is registered as a collateral charge, other debts secured by it (like a line of credit) may need to be paid off or moved too.

Don't let it renew on autopilot

If you do nothing, your mortgage may renew automatically, and FCAC warns you may not get the most favourable rate and conditions available. Your renewal statement will say if your lender plans to renew automatically.

A simple renewal checklist

1. Find your maturity date and set a reminder for about 120 days before.
2. Check your balance, remaining amortization, and whether your charge is standard or collateral.
3. Get a broker comparison and any early-renewal offer from your current lender.
4. Decide on term, fixed or variable, and payment frequency. If you're considering a variable rate, read how Bank of Canada decisions reach your mortgage.
5. Thinking of borrowing more at renewal? Compare a refinance before you sign.
6. Sign the option you choose before the maturity date.

For how John helps with renewals and switches across Alberta, see mortgage renewal in Alberta.