Mortgage Renewals & Refinancing

Roughly a third of the mortgages renewing in Ontario over the next two years were funded in the ultra-low-rate window, and most of those borrowers are renewing into a materially higher payment. The bank's renewal letter is not the market rate — it is an offer priced on the assumption that you will sign it. The measurable cost of signing without shopping is typically 15 to 40 basis points, which on a $600,000 balance is $1,000–$2,600 a year in avoidable interest, before you consider whether the term and prepayment terms even suit you.

A renewal is also the one moment in the mortgage lifecycle where switching lenders is nearly frictionless. At maturity there is no penalty, the switch is usually paid for by the new lender, and no new appraisal is typically required on a straight transfer. The paperwork is real but it is our paperwork, not yours. The decision splits three ways: accept the incumbent's improved offer, transfer the balance as-is to a better-priced lender, or refinance to a larger balance if you have a use for the equity — consolidating high-interest debt, funding a renovation, or bridging a family purchase.

Term selection is doing most of the work right now. With the overnight rate at 2.25% and prime at 4.45%, variable pricing near prime minus 0.70% and three-year fixed pricing inside five-year fixed pricing, the right answer depends on whether you need payment certainty or optionality. Households with tight cash flow and no plans to move usually want fixed; households expecting a sale, a payout, or a further easing cycle usually want the shorter term or the variable. We model both against your actual balance and amortization rather than quoting a headline rate.