Roughly 1.2 million Canadian mortgages are up for renewal in 2025, and about 85% of those were originated when the Bank of Canada’s rate was ≤1%. Many households will face higher payments at renewal, so going in with a plan matters.
The big picture
The rate environment has eased from its 2023 peak, yet it remains above the near-zero era when many mortgages were originated. Renewal choices—fixed or variable, term length, amortization, and whether to refinance—will shape your cash flow for years. Check the policy-rate history when you time your decision. Reuters+1
10 smart questions to ask before you renew
1) Should I pick fixed or variable this time?
Match the rate type to your risk tolerance and income stability. If cash flow is tight or your income is uneven, fixed can offer predictable payments. If your income has grown and you can handle swings, variable may work, knowing payments or amortization could change. stories.td.com
2) What term length fits my outlook?
Shorter terms give flexibility if you expect rates to drop further. Longer terms trade flexibility for stability. Use your life plans—job changes, moves, renovations—to guide the choice.
3) Renew or refinance—what’s better for me?
A straight renewal keeps things simple. A refinance can consolidate higher-interest debts or access equity for upgrades, at the cost of re-qualification and possible fees.
4) Can I adjust my amortization?
Extending amortization lowers payments by stretching them over more years. It raises total interest over time, so treat this as a cash-flow lever, not a default.
5) What prepayment privileges will I use?
Many lenders let you increase payments or make lump sums annually. Even small, steady bumps can cut total interest significantly.
6) How will penalties work if I break early?
Ask for a written penalty estimate under your likely scenarios. Know the difference between IRD (interest rate differential) and three-months’ interest.
7) What happens to my HELOC?
If you have a readvanceable mortgage, confirm whether terms change at renewal and how principal paydown affects your line of credit.
8) Is my debt-to-income still within lender comfort?
If your income changed, ask your broker or lender to test affordability with today’s qualifying rate before you lock in.
9) What is the all-in cost from each lender?
Compare apples to apples: rate, fees, cash-back conditions, prepayment rules, portability, blend-and-extend options, and penalty math.
10) When should I start?
Start about six months before maturity. Shop options early, hold rates if available, and keep documents ready. The earlier you start, the fewer surprises at closing. (Banks and brokers encourage early outreach for a reason.) stories.td.com
Hamilton–Burlington homeowners: local playbook
- Audit cash flow. Price your comfort zone first, then pick the product.
- Pre-underwrite your renewal. Even at renewal, your lender may reassess risk.
- Line up docs early. Pay stubs, T4s, NOAs or T1s for self-employed, property tax bill, insurance, and current mortgage statements.
- Ask about portability. Planning a move soon? A portable or open term can save penalties.
Tip: Mortgage compliance rules for brokers and lenders tightened in October 2024. Expect more ID checks and source-of-funds questions if you refinance or add funds. Clean documentation speeds everything up. FINTRAC
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