Renewal comparison
Your lender's renewal letter offer vs the best market rate. Quantify what's at stake — most borrowers leave thousands on the table.
Your scenario
Result
Same-lender renewals skip the stress test; switching lenders requires you to re-qualify.
Why renewal is the biggest one-time savings opportunity in your mortgage
60-70% of Canadians accept the rate their existing lender offers in the renewal letter. Lenders know this — and price renewal offers 25-75 bps above their best available rate. Just comparing 2-3 alternative quotes typically saves $5,000-$25,000 over the term.
How to actually use this calculator
- Pull your renewal letter — note the offered rate
- Get 2-3 broker quotes for your specific balance + amortization
- Plug the best alternative rate in the "Best market rate" input
- Add typical switching costs ($800 captures discharge + most legal scenarios)
- See the net savings — usually well above the switching costs for any rate spread above 25 bps
What this calc captures vs misses
Captures: rate-driven savings over the term, switching costs, monthly payment delta.
Misses: stress-test re-qualification requirements (switching requires it; same-lender renewal doesn't), feature differences between lenders (prepayment privileges, port-ability, break penalty mechanics), bundling benefits from your existing lender (chequing + investment relationship discounts).
The stress-test wrinkle
If you switch lenders at renewal, the new lender must qualify you under the federal stress test (higher of contract + 2% or 5.25%). Same-lender renewals skip this entirely. Borderline files where income dropped or debt grew since the original mortgage may fail the re-qualification — locking them with their existing lender by default.
How to negotiate without switching
Often the best outcome is to get a competitive quote elsewhere, then call your existing lender's mortgage retention team (not the renewal letter contact). Most will match 75-90% of the way to keep your business — saves the switching costs while still capturing meaningful rate savings.
Related
Questions about this calculator
- Should I accept my lender's renewal offer?
- Usually not as sent. The first offer a lender mails is rarely their best, and it is priced on the assumption you will not shop. Getting one competing quote is normally enough to move it, and the difference over a five-year term is commonly several thousand dollars.
- When should I start shopping my renewal?
- Around 120 days out. Most lenders will hold a rate for you for 90 to 120 days, so starting early means you capture today's rate and still benefit if rates fall before your renewal date. Waiting until the renewal letter arrives removes all of your leverage.
- Does switching lenders at renewal cost anything?
- A straight switch of the existing balance usually carries no penalty, since your term has ended. There may be a discharge or assignment fee, and many lenders cover the legal cost of a switch to win the business. Increasing the balance makes it a refinance, which is different.
- What happens if I do nothing at renewal?
- The mortgage does not disappear — most lenders roll it into their posted rate or a short open term, which is materially more expensive than any negotiated rate. Doing nothing is the single most expensive option available at renewal.