Your lender will send a renewal notice 30 to 120 days before your term ends. It will look official. It will feel like something you just sign and return.
It isn’t.
A renewal offer is a starting point, not a final answer. Lenders know that most borrowers accept whatever rate is on the page. Renewal offers are priced accordingly.
A licensed Ontario mortgage broker shops your renewal across dozens of lenders and brings you the best rate and terms available. There is no fee for the service. The lender pays the broker when your mortgage funds.
What Happens When Your Mortgage Comes Up for Renewal
At the end of your mortgage term, the full outstanding balance becomes due. Your lender offers to renew at their current posted rate for your chosen term.
If you sign the renewal offer, your mortgage continues with the same lender at the new rate. If you shop your renewal, you may switch lenders, negotiate a lower rate, or change your amortization, payment frequency, or mortgage type.
Renewal is also the best time to consolidate higher-interest debt, adjust your payment structure, or reassess whether a fixed or variable rate is right for your situation.
Do You Need to Pass the Stress Test at Renewal?
This depends on whether you stay with your current lender or switch.
| Renewal Scenario | Stress Test Required? |
|---|---|
| Renewing with your current lender, no changes | No |
| Switching to a new lender at renewal | Yes |
| Refinancing at renewal (changing the loan amount) | Yes |
| Adding or removing a borrower from the mortgage | Yes |
If you are switching lenders, you will need to qualify at the higher of your contract rate plus 2%, or 5.25%. For most borrowers in solid financial standing, this is not a barrier. A broker will confirm your qualification before submitting anything.
How Much Is a Better Rate Worth?
The difference between a lender’s renewal offer and a shopped rate is often 0.40% to 0.75%. On a $500,000 balance with 15 years remaining, that adds up quickly.
| Scenario | Rate | Monthly Payment | 5-Year Interest Cost |
|---|---|---|---|
| Lender renewal offer | 6.09% | $3,560 | $103,100 |
| Shopped rate via broker | 5.54% | $3,398 | $93,700 |
| Difference | 0.55% | $162/month | $9,400 |
*Based on $500,000 balance, 15-year amortization remaining. For illustration purposes only.*
That $9,400 stays in your pocket.
When to Start the Renewal Process
Start shopping 90 to 120 days before your renewal date. This gives you time to compare lenders, confirm terms, and avoid any gap between your term ending and your new mortgage funding.
If you wait until your lender sends a renewal offer, you are already behind. The best rates require time to arrange, and switching lenders takes a few weeks to coordinate.
Switching lenders at renewal requires the same documentation as a new mortgage: income confirmation, a credit check, and property confirmation. A broker manages the paperwork and coordinates with the new lender directly.
What a Mortgage Broker Does at Renewal
A broker does not just find a lower rate. They review your full financial picture and ask the right questions.
Has your income changed since your last term? Do you carry higher-interest debt that could be consolidated? Is a variable rate now more appropriate than fixed, or the reverse? Does your remaining amortization still match your financial timeline?
These are not questions your bank will ask at renewal. A broker will.
At Pekoe.ca, we work with Ontario borrowers at every stage of their mortgage, including renewal. We are licensed by FSRA and work with lenders you cannot access on your own.
Ready to Get a Better Rate on Your Renewal?
If your mortgage is renewing in the next 120 days, or even the next six months, now is the time to start.
Get a free mortgage renewal review with no obligation.
