10 Great Mortgage Renewal Tips for Canadians in 2025
Mortgage renewals might not be the most exciting part of homeownership—but trust us, getting this step right can save you thousands.
And in 2025, with rate fluctuations, new lender offers, and homeowners becoming more financially savvy than ever, it’s the perfect time to sharpen your renewal game.
Let’s start with a quick refresher:
What Is a Mortgage Renewal?
Not to be confused with mortgage refinancing, mortgage renewal occurs when your current mortgage term ends—whether it’s five years, three, or even one—at which point you’ll need to renew your mortgage unless you’re paying it off in full. Most Canadians don’t own their home outright after the first term, so this renewal process is totally normal.
Your lender will usually send you a renewal statement 3-6 months before your term ends, outlining the proposed interest rate, term length, and other conditions. If you do nothing, you might be automatically locked into a higher rate. But if you play your cards right, a mortgage renewal is a golden opportunity to save money, make changes, or even switch lenders.
Now that we’re on the same page, let’s dive into the real gold:
Great Mortgage Renewal Tips for Canadians in 2025
These aren’t just good tips—they’re the kind of "I’m so glad I read this" advice that’ll make Future You look back with a smile and a lower interest rate.
1. Start Shopping 4–6 Months Before Your Term Ends
Don’t wait for your lender to send you that renewal slip. Most lenders will guarantee a rate 90 to 120 days in advance, and this is your chance to shop around. Early birds can snag better rates, avoid the renewal rush, and skip last-minute pressure.
Pro tip: Use those months to ask your mortgage broker to compare offers from specialty lenders, credit unions, and banks—not just the Big Five.
2. Don’t Automatically Sign the Renewal Slip
It’s convenient, sure, but that convenience comes at a price. Lenders often don’t offer their best rates on auto-renewals. By signing without negotiating or exploring, you could be leaving serious money on the table.
Be bold. Be curious. Ask: “Is this your best offer?” Then smile as they suddenly find something better “just for you.”
3. Focus on Your Goals, Not Rate Predictions
Trying to time the market or predict where interest rates are headed is rarely a reliable strategy—especially for something as important as your mortgage. Instead of guessing what the Bank of Canada might do next, it’s better to speak with a mortgage expert who can help you choose a product that fits your personal goals and risk tolerance. When your mortgage aligns with your financial comfort zone, you can feel confident in your choice—regardless of where rates go.
4. Consider a Short-Term Fixed Rate
If you’re planning to pay off your mortgage in a year or two, why lock into a long 5-year term?
A 1- or 2-year fixed mortgage might give you a lower rate and flexibility. You’ll avoid prepayment penalties, and when your timeline is short, every dollar counts.
5. Compare Open vs. Closed Mortgages
If you're nearing the end of your mortgage journey—say, with less than $100K left—then an open mortgage might be worth it. Open terms let you pay it off at any time with zero penalty.
Just be warned: they often come with higher interest rates. So if you know you won’t pay it off immediately, a closed mortgage with good prepayment privileges might still be smarter.
6. Ask About Prepayment Privileges
Speaking of which: know your privileges! Prepayment terms let you put lump sums toward your principal, usually between 10% to 20% of the original mortgage amount per year.
If you’re sitting on a bonus, tax return, or savings, this could help slash your interest costs and shorten your amortization.
7. Think Beyond Just the Rate
Sure, interest rate matters. But so do:
Prepayment options
Portability (can you take the mortgage with you if you move?)
Penalties for breaking early
Flexibility in payment frequency
Focus on the whole package, not just the headline rate. This is your chance to pick a mortgage that actually fits your life, not just your bank’s marketing sheet.
8. Consider a HELOC (Home Equity Line of Credit)
If you’re in a strong equity position and want maximum flexibility, a HELOC might be a savvy tool.
Instead of locking into a new mortgage, some homeowners pay off the remaining balance with a HELOC, and then chip away at it at their own pace—with interest-only minimum payments and no mortgage break penalties.
Just don’t treat it like free money. It’s still debt. Be strategic.
9. Use a Mortgage Broker
Your bank will offer what they offer. A mortgage broker will shop across multiple lenders and could find you a better rate, a better product, or both.
The best part? Most brokers get paid by the lender—not you. So there’s often no out-of-pocket cost for their help.
10. Double Down on Debt Strategy
Your renewal date is a perfect moment to look at your overall financial situation. Do you want to:
Increase your payments to pay off the home faster?
Stretch out your amortization to free up cash flow?
Consolidate high-interest debt into your mortgage?
Or maybe it’s time to pay it off completely?
Whatever you do—have a clear goal. Renewals shouldn’t be autopilot moments. They should be calculated, strategic moves.
Final Thoughts
Mortgage renewal isn’t just some formality you sign and forget—it’s one of the biggest financial decisions you’ll make every few years. And in 2025, with all the changing rates and options available, being informed and proactive puts the power right back in your hands.
Aren’t you glad you found these tips? Bookmark this, save it, and when that renewal notice shows up in your inbox or mailbox, you’ll be the one with the upper hand.
Whether you go open, closed, HELOC, or fixed, remember this: it’s your mortgage. Make it work for you.
