Switching Mortgage Lenders at Renewal in Ontario: Should You Stay or Switch?

Your mortgage renewal offer arrives, and the easiest option is to sign it. But before you commit to another term, it’s worth asking: does this mortgage still fit your life?

Perhaps your income has changed. You may be planning a move, carrying other debts or hoping to pay your mortgage off faster. The mortgage you chose several years ago may no longer match what you need.

You can switch mortgage lenders at renewal in Ontario, provided the new lender approves your application. Whether you should switch depends on the complete offer: the interest rate, costs, repayment flexibility and conditions.

For homeowners in Hamilton and across Ontario, renewal is an opportunity to compare those details before making a decision.

Can you change lenders when your mortgage renews?

Yes. You do not have to renew with your existing lender.

The Financial Consumer Agency of Canada recommends comparing options a few months before your term ends. Moving to another lender requires a new approval, and switching may involve discharge, registration, appraisal or administration costs. Ask whether the new lender will cover any of them. Source: FCAC’s mortgage renewal guide.

A useful starting point is your current lender’s written offer. It gives you something concrete to compare against other options.

Already have a renewal offer? Ask Mission35 to compare your mortgage options.

Compare more than the mortgage rate

A competitive rate matters. So does choosing a mortgage that works when your circumstances change.

Before accepting an offer, ask for answers to these questions:

What to compare	What to ask
Monthly payment	Is this calculated using the same remaining amortization as my other quotes?
Upfront costs	What will I pay personally, and what will the lender cover?
Extra payments	How much can I pay above my scheduled payment without a penalty?
Moving plans	What conditions apply if I want to move this mortgage to another property?
Early exit	How would the cost of ending the mortgage early be calculated?
Remaining balance	How much will I still owe at the end of the proposed term?

Ask for a comparison using consistent assumptions. Otherwise, two offers may look similar while answering different questions.

For example, one payment may be lower because the repayment period is longer. FCAC explains that extending amortization can reduce payments but increase total interest costs. Source: FCAC’s guide to mortgage terms and amortization.

Do you need to pass the stress test when switching lenders?

Some qualifying lender switches are exempt from the prescribed minimum qualifying rate, commonly called the mortgage stress test.

OSFI’s exemption applies to eligible uninsured “straight switches” between federally regulated lenders at renewal, without increasing the mortgage amount or remaining contractual amortization, subject to the rule’s conditions.

An exemption from that prescribed test does not mean automatic approval. The new lender still assesses the application. Ask your mortgage professional which rules apply to your specific mortgage and proposed transaction. Source: OSFI’s straight-switch guidance.

If you want additional funds or a longer repayment period, explain that at the start. Your broker needs to assess the transaction you actually want, rather than quote a straightforward switch that may not meet your needs.

A practical example: you may move during the next term

Imagine you own a home in Hamilton and expect to move within two years.

You receive two mortgage offers. One has a slightly lower rate. The other appears to offer features that may suit your moving plans.

Before choosing, ask both lenders:

• What would happen if I sold after 18 months?

• Could I transfer the mortgage to another property?

• Would I need to qualify again?

• What happens if the new property costs more or less?

• What costs apply if transferring the mortgage is not possible?

There is no need to guess which offer is better. Ask your broker to explain how each would work under your likely moving scenario.

The same approach helps if you expect to receive a lump sum, reduce your working hours or make major changes to your household budget.

What should you prepare for a renewal review?

Start with your latest mortgage statement and renewal offer, if available.

Then write a short summary covering:

• Your renewal date.

• Your preferred monthly payment.

• Whether you expect to move.

• Any additional borrowing you are considering.

• Changes in employment or income.

• Your plans for extra mortgage payments.

Ask your broker which supporting documents are needed. CMHC’s application guidance identifies income, debts, financial records and property information as common parts of a mortgage application, while noting that lender requirements vary. Source: CMHC’s mortgage application tips.

Frequently asked questions

Should I accept an early renewal offer?

Compare the proposed start date, payment and total cost with keeping your existing mortgage until maturity. Ask what you gain by accepting early and what you give up. An expiry date on an offer should prompt a timely review, not replace one.

Is staying with my current lender a bad decision?

No. A comparison may show that staying fits your needs. The purpose of shopping around is to make an informed choice, including understanding when your existing offer is competitive.

Can I consolidate debt when my mortgage renews?

Tell your broker you want to explore additional borrowing. Ask for a separate refinance assessment, including qualification, costs and the effect on your repayment schedule.

What if my renewal date is close?

Contact your lender and broker promptly. Provide the exact maturity date and ask what can realistically be completed. Do not assume a switch is arranged until the necessary approvals and closing requirements are confirmed.

Compare your renewal options with Mission35

Before signing another mortgage term, make sure you understand how the offer fits your budget and plans.

Bring Mission35 your renewal date, mortgage statement and current offer. Ask us to compare the available options and explain the trade-offs.

Request a mortgage renewal comparison or call 905-574-5255.

Explore our mortgage services to learn more.