Switch lenders at renewal: is it worth it?

Your lender's renewal offer vs a better rate elsewhere, after the cost of switching.

It must arrive at least 21 days before your term ends (FCAC, federally regulated lenders).
Default: Bank of Canada average new uninsured 5-year+ fixed, 4.58% (2026-08).
Net saving over 5 years$4,547costs paid back in 9 months
Payment with renewal offer
$2,473
Payment if you switch
$2,412
Interest saved
$5,347
Switching costs
$800
Usually no stress test on a straight switchSince November 21, 2024, OSFI doesn't expect lenders to apply the qualifying rate when an uninsured mortgage moves to another federally regulated lender at renewal with no increase to the amortization or the loan amount, so pay these costs in cash. A low-ratio (portfolio-insured) mortgage may add up to $3,000 for costs (Department of Finance, December 16, 2024). A lender can still choose to requalify you, so ask. Take cash out or stretch the amortization and it's a refinance, which must qualify.
Use the quoteShow your lender the other offer before you sign the renewal; many will match it, which saves the switching costs entirely.

Estimate, not advice. Educational estimate only, not financial, mortgage, tax or legal advice. Lenders, insurers and governments set their own rules and can change them; confirm with a licensed professional before you decide.

Switching saves $4,547 over 5 years after $800 of costs.

Net saving by rate gap and balance
Rate gap ↓ / Balance →$200K$300K$400K$600K$800K
0.10 pts+$139+$608+$1K+$2K+$3K
0.20 pts+$1K+$2K+$3K+$5K+$7K
0.30 pts+$2K+$3K+$5K+$8K+$10K
0.50 pts+$4K+$6K+$9K+$13K+$18K
0.75 pts+$6K+$10K+$13K+$20K+$27K
Rows: how much lower the other lender's rate is. Columns: balance. Same costs and term.
Assumptions & sources

Assumptions

  • Same balance and amortization on both sides; semi-annual compounding. Costs are paid in cash at the switch.
  • Fees are our estimates; FCAC lists discharge, registration, transfer or assignment and appraisal fees as possible switching costs.

Sources

  1. Financial Consumer Agency of Canada — Renewing your mortgage (21-day renewal statement; switching costs) (effective October 15, 2025). Checked .
  2. OSFI — Uninsured straight switches exempt from the minimum qualifying rate (no increase to the amortization or the loan amount) (effective November 21, 2024). Checked .
  3. Department of Finance Canada — Straight switches and portfolio insurance (low-ratio insured switches; up to $3,000 for costs) (effective December 16, 2024). Checked .
  4. OSFI — Minimum qualifying rate for uninsured mortgages (contract + 2 points or 5.25%) (effective January 29, 2026). Checked .
  5. Bank of Canada — Effective rate on new uninsured fixed mortgages, 5 years and over (series V122667786) (effective August 1, 2026). Checked .
  6. Bank of Canada — Effective rate on new uninsured fixed mortgages, 1 to <3 years (series V122667784) (effective August 1, 2026). Checked .
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