The most common myth I hear in Kelowna: “Switching my mortgage to a new lender is too much hassle.” It isn’t. At renewal it’s usually a quick, low-cost process — and it’s where most of the savings live.
Why there’s no penalty at renewal
A prepayment penalty applies when you break a mortgage mid-term. At renewal your term has ended, so there’s nothing to break. You’re free to move your balance to whichever lender offers the best deal, penalty-free. This is the leverage your bank is quietly hoping you won’t use.
The step-by-step
- Mark your maturity date and start 90–120 days early. That’s the window to lock a rate hold and compare without time pressure.
- Gather your details: balance, remaining amortization, current rate, and your bank’s renewal offer.
- Compare the whole market. This is where I come in: I pull rates and products from 50+ lenders and match them to your situation.
- Pick the best fit and apply. A switch involves one standard credit check and basic income and property confirmation, which is lighter than a new purchase.
- Let the new lender handle the transfer. Many cover the transfer and legal costs through a switch program, so the move can be effectively free.
How much can switching save?
On a $500,000 balance, improving your rate by 0.25% saves about $1,250 a year (~$6,250 over five years). At 0.50% you’re saving about $2,500 a year, and at 0.75% about $3,700 a year. If you also want to pull out equity, that’s a refinance rather than a straight switch, and the math works differently.
The one thing not to do
Don’t auto-sign. The bank’s renewal letter is the path of least resistance, and usually the most expensive door in the room. Even if you ultimately stay, comparing first either gets you a better rate or confirms you’re already in good shape. Start with a free renewal review or call me at 250-859-2100.
Related guides: Mortgage renewal vs. refinance in Kelowna · The 2026 renewal cliff · Mortgage renewal in Kelowna
Related reading: compare current Kelowna mortgage rates