How to Negotiate Your Mortgage Renewal in Ontario

Published 2025-01-15 · Updated 2026-07-22 · Reviewed against guidance from FSRA-licensed brokers

How do I negotiate my mortgage renewal rate?

Start about 120 days before your maturity date, get one written quote from another lender, and take it to your bank’s retention team. Your renewal letter is an opening offer, not the best rate your lender will give you. A written competing offer is what moves it.

According to the Financial Consumer Agency of Canada (FCAC), you are not obligated to renew with your current lender, and you should compare options before you sign.

Why your renewal letter isn’t the best rate

Lenders mail renewal offers about 21 days before your maturity date, the legal minimum. These offers usually sit 0.15% to 0.40% above what you could negotiate or find elsewhere. On a $400,000 mortgage, a 0.25% difference is roughly $1,000 a year, or about $5,000 over a five-year term. Your bank keeps a posted renewal rate and a lower rate it holds back for customers who are clearly shopping. You get to that second rate by proving you have somewhere else to go.

The one move that beats everything else: a written quote

Get a written rate quote from another lender before you call your bank. “I saw something cheaper online” means nothing to a retention agent. A real offer, in writing, on the same term, is your entire negotiating position. Get quotes from three to five lenders if you can, or have a broker pull them in one step.

What to say when you phone them

Call the number on your renewal letter and ask for the mortgage retention team, or a mortgage specialist with the authority to discount. A general phone agent or teller can usually only read you the posted rate. Then keep it short. “I have a written offer from another lender at a lower rate, same term. I’d rather stay. Can you beat it?” Stop talking and let them respond. Retention staff often have room to shave 0.10% to 0.25% off the offer, and they may need a day or two to escalate for their best number. If the first person can’t move, ask to be transferred to retention.

The 120-day timeline

1. 120+ days out. Check your mortgage statement for your maturity date, remaining balance, and whether your mortgage is insured or uninsured. This is also the earliest you can lock a rate hold, at no cost.
2. 90 days out. Get written quotes from at least three lenders. A licensed broker does this in one step across 30+ lenders.
3. 60 days out. Call your lender’s retention team with the best competing quote in hand. Ask them to beat it.
4. 30 days out. Make your decision. If you switch, your new lender handles the transfer.
5. Maturity date. If you haven’t signed, most mortgages roll to a costly open or posted-rate term. Don’t let that happen by default.

What’s the penalty for renewing early?

At your maturity date, there is no penalty to switch lenders. A penalty only applies if you break the mortgage partway through the term, and then it is the greater of three months’ interest or the interest rate differential (IRD). On a variable mortgage that is usually just the three months. On a fixed mortgage the IRD can run into the thousands. Breaking early only pays if the lower rate saves you more than the penalty costs, so ask your lender for the exact penalty in writing before you decide.

The 2024 rule change that gives you leverage

Since November 21, 2024, uninsured homeowners (those who put at least 20% down) can move to a new lender at renewal on a straight switch, same balance and same amortization, without passing the stress test again. Insured borrowers were already exempt. The old barrier that kept people with their bank is gone, which is exactly why a competing quote carries weight now. Leaving is easy.

When to use a broker instead

Doing this yourself works. It also means pulling your statement, calling three to five lenders, getting each quote in writing, working out the IRD math, and negotiating with people who do this every day. A licensed mortgage broker does all of it. The edge is pricing, not just choice. The big banks often reserve their sharpest rates for the broker channel, commonly around 0.10% to 0.30% below the branch offer, because a lender competes harder when it knows you’re comparing many of them at once. A broker gets that pricing from the same banks, credit unions, and broker-only lenders in one step, and some will buy your rate down further with part of their own commission. The broker is paid by the lender, not by you, so there is no cost to the borrower.

If your income is self-employed, you have rental properties, or your balance is above $500,000, a broker is especially worth it, because qualification rules differ sharply between lenders.

Figures shown are indicative and for general information only, subject to qualification and lender approval, OAC. Not a quote. A licensed mortgage broker provides your personalized quote.

Sources

• FCAC, Renewing your mortgage
• OSFI, Minimum qualifying rate for uninsured mortgages
• Bank of Canada, Policy interest rate