The letter arrives four to six months before your maturity date. It has your new rate on it, a form to sign, and a friendly tone suggesting this is all very simple.

It is simple. That is exactly the point.

Here is what most people do not realize: that rate is not your bank's best rate. It is an opening offer, calibrated on the reasonable assumption that a meaningful percentage of customers will sign it without checking anything.

Why the Offered Rate Is High

Lenders know that switching requires effort. They know renewal letters arrive during busy periods of people's lives. They know the friction is real.

So the renewal rate they lead with is priced with that friction in mind. Meanwhile, the same institution is advertising a better rate to attract new customers, and will often approve a better rate for you too if you ask.

This is not a scandal. It is simply how the market works, and it only costs you money if you do not participate in it.

What the Difference Is Worth

On a $600,000 mortgage over a five-year term, a quarter-point rate difference costs roughly $7,000 in additional interest. Half a point is closer to $14,000.

Those are real numbers, and the effort required to capture them is a phone call.

Renewal Is Your Cleanest Moment to Move

Here is what makes renewal different from any other point in your mortgage.

At maturity, there is no prepayment penalty. None. You are free to move your mortgage to any lender who will have you, at no cost for breaking anything.

At any other point in your term, switching means paying a penalty that can run into the tens of thousands on a fixed-rate mortgage.

Renewal is the one moment where the door is wide open. It is genuinely the best negotiating position you will hold during the entire life of your mortgage.

What Switching Actually Involves

People overestimate this considerably.

A straight switch, meaning the same mortgage balance moving to a new lender with no additional funds, is a light process. You provide income documents and consent to a credit check. The new lender confirms the property. Many lenders cover the legal and appraisal costs to win your business, which means switching costs you nothing out of pocket.

It typically takes two to three weeks. Your payments continue uninterrupted. Nothing about your home changes.

The main thing that complicates a switch is a collateral charge mortgage, which some lenders use and which can require full legal discharge and re-registration. That is worth checking on early, and I check it for every client.

Renewal Is Also a Strategy Moment

The rate is the obvious question, but it is not the only one worth asking at renewal.

Should your amortization change? If your income has grown, shortening it saves substantial interest. If cash flow is tight, extending it creates room.

Should you consolidate debt while you are here? If you are carrying high-interest balances, folding them into your mortgage at renewal avoids the penalty you would pay doing it mid-term.

Should the term length change? Five years is the default, not the only option. Shorter terms give you flexibility to reassess sooner.

Do you need to access equity? Renovations, an investment property, a child's education. Renewal is the natural moment to restructure.

Are the prepayment privileges right for you? Lenders differ substantially on how much extra you can pay annually. If your goal is paying the mortgage off early, this matters more than a small rate difference.

What to Do and When

Six months out: Get in touch with a broker. This is early enough to plan and to hold a rate.

Four months out: Your lender's offer arrives. Do not sign it.

Three months out: Compare the market. Decide whether to negotiate with your current lender or move.

Two months out: Submit the application, whether that is a switch or a renegotiated renewal.

One month out: Documents signed, everything in place.

The rate hold is worth understanding. When we lock a rate for you, you are protected if rates rise before your maturity date, and if rates fall you generally get the lower rate. There is no downside to starting early.

I Review Every Client's Renewal

My clients do not sign their bank's first offer, because I get in touch before the letter arrives. It is part of the relationship, not a separate service.

If your mortgage is coming up for renewal and you want to know what is actually available to you, call 604-787-5136. I will compare the full market across 60+ lenders and tell you honestly whether staying or moving is the better move.



Sometimes staying is right. But you should know that because you checked, not because signing was easier.