Start reviewing your mortgage a few months before the term ends. Compare the rate, payment, fees and flexibility of your current offer with suitable alternatives. A switch at maturity usually avoids a prepayment penalty, but other costs and lender approval still apply.
Get your current mortgage details ready
Use your latest statement to find the balance, payment, maturity date and remaining amortization. Keep the renewal offer alongside it so you can compare the terms.
Start with your next few years
Before comparing rates, decide whether you expect to move, repay extra, take leave or retire during the next term. These plans can change which mortgage is suitable. Gather your current statement, renewal date and any offer you have received.
Compare the complete offer
- The interest rate, payment and length of the term
- Prepayment limits and the cost of breaking the mortgage early
- Portability if you may move
- Discharge, legal, registration and appraisal costs when switching
- Any cash incentive that must be repaid if you leave early
Give yourself time
Begin a few months before maturity. Rate-hold periods and options for a lower rate vary by lender, so ask what an offer actually protects. Federally regulated lenders must provide the renewal statement at least 21 days before the term ends. You can begin comparing before that statement arrives.
Will a switch need a stress test?
The new lender still reviews your income, credit, debts and property. OSFI does not require its minimum qualifying rate for an uninsured straight switch between federally regulated lenders at renewal when neither the loan amount nor the amortization increases. The lender can still apply its own approval requirements.
Increasing the balance or extending the amortization can change the application into a refinance. Confirm the rules and costs for your particular mortgage before accepting an offer.
If your teaching income has changed
Bring a current board letter and pay stubs if you have moved up the grid, changed boards or taken a new assignment. For leave or retirement, discuss both the income a lender will accept and the payment your household can afford.
Sources and dates
Sources below support the relevant figures and rules. Source dates and historical salary years are shown where available. A planned review date does not guarantee that a figure stays current; check the source and your own eligibility before acting.
First published . Updated . Source dates are listed above.
Common questions
Is there a penalty for switching lenders at renewal?+
A switch completed at maturity normally avoids a prepayment penalty. Other costs may apply. Ask for a written breakdown and confirmation of any costs the new lender will cover.
Do I have to requalify to switch lenders?+
The new lender must approve the application. Eligible uninsured straight switches between federally regulated lenders do not require the prescribed OSFI stress test when the balance and amortization do not increase.
Should I stay with my current lender?+
That may be a good choice if its offer fits your needs. Compare the full cost and terms first, including the costs of switching.
Talk to us
Emily & Jeff Mudrick
Mortgage agents, Mudrick Mortgages
Serving teachers across Ontario.
Discuss your mortgage plans
Bring your questions about buying, renewing or refinancing. We will help you understand the next steps.