Key Takeaways
– Over 50% of Canadian mortgage holders auto-renew with their current lender without shopping — typically costing $3,000–$8,000 over the next term.
– Starting 120 days before your maturity date gives you time to get competing quotes before your lender’s offer arrives.
– Since January 2026, OSFI no longer requires a stress test when you switch lenders at renewal (same loan amount, same amortization).
– Many Kelowna homeowners who took 2–3 year fixed terms in 2023–2024 at 5.5–6% are now renewing into the 4% range.
– A Kelowna mortgage broker shops 50+ lenders at once; your bank rep shops one.
Renewal is the most underused leverage point in the Canadian mortgage system. Your lender knows you probably won’t leave. That assumption is built into the rate they send you.
12 Steps Before You Sign Your Mortgage Renewal
Step 1: Start 120 days before your maturity date. Most lenders hold a rate for 120 days. Starting early means you can lock in now and still benefit if rates drop before renewal. Most lenders send renewal offers only 21–45 days before maturity — too late for the best rate holds.
Step 2: Get a broker quote before your lender’s offer arrives. Your lender’s renewal letter is a starting position, not a final offer. We see this regularly: the bank sends 4.49%, the broker finds 4.09% — on a $700,000 mortgage, that’s roughly $14,000 over five years.
Step 3: Ask whether you should renew or refinance. Renewal = same balance and amortization at a new rate. Refinancing = change loan amount, access equity, or restructure amortization. See: mortgage renewal vs. refinance.
Step 4: Review your remaining amortization. You can shorten or maintain at renewal. You generally cannot extend beyond the original schedule without refinancing.
Step 5: Decide on fixed vs. variable. Best insured 5-year fixed: 4.04% (June 2026). Variable: prime minus 0.50–1.0% (roughly 3.95–4.45%). Choose based on risk tolerance and your read of the Bank of Canada’s trajectory.
Step 6: Check your prepayment privileges. Standard: 10–20% lump-sum annual payments, 10–20% payment increases. If you expect bonus or inheritance income during the term, strong prepayment privileges matter.
Step 7: Factor in the break penalty if switching mid-term. At maturity, no penalty. Mid-term early exit: see mortgage break penalty BC — big bank IRDs can be 3–5× larger than monoline penalties.
Step 8: Pull your credit report. Below 680 narrows your lender options. Above 720 gives best rates. Pull from Equifax or TransUnion (doesn’t affect score) and address errors before your renewal date.
Step 9: Update your financial documents. Prepare pay stubs, T4, and NOAs. Even at renewal, many institutions now require income confirmation if your file shows gaps.
Step 10: Compare across lender tiers. Big Six banks, credit unions, monoline lenders (broker only), and B-lenders all price differently. Monolines typically offer the lowest rates and most favourable penalty formulas.
Step 11: Negotiate — your lender will often move. Bring a competing quote. Many lenders will match or come close rather than lose an existing client.
Step 12: Use a broker so someone else does the shopping. Free to you — brokers are compensated by lenders at funding.
FAQ
What changed with the OSFI stress test at renewal?
Since January 2026, OSFI removed the stress test for borrowers switching lenders at renewal (same balance, same amortization). You still need to meet credit and income requirements, but the stress test hurdle is gone.
How early should I start the process?
120–150 days before maturity. Gives time to shop, lock in a rate hold, and complete paperwork without rushing.
Is it worth switching lenders?
Switching costs $500–$1,200. If the rate difference saves $800+/year, switching usually makes sense on a 5-year term. We run that calculation for every client.
Can I increase my mortgage at renewal?
No. Renewal maintains your existing balance. To access equity or consolidate debt, you need to refinance.
Ash Simpson — licensed mortgage broker, Kelowna BC, since 2019. CMP Rising Star 2021. Call 250-859-2100.
Related reading: current Kelowna mortgage rates