Mortgage Renewal KELOWNA

A mortgage renewal occurs when your current mortgage term ends and you agree to new terms with your existing lender. While mortgage payments are typically structured around a long repayment timeline—often up to 30 years in Canada—your mortgage term itself is much shorter, commonly lasting two to five years.

If you’ve made your payments on time and intend to stay with your current lender, the renewal process can be relatively simple. In many cases, your lender will send a renewal offer ahead of your term’s expiry. Once signed and returned, the updated mortgage terms take effect based on the outstanding balance at renewal.

That said, convenience doesn’t always mean the best outcome. Automatically renewing without reviewing your options may cause you to miss opportunities for better rates, flexibility, or long-term savings.

The end of a mortgage term is an ideal time to reassess whether your current mortgage still aligns with your financial goals. Changes in your income, lifestyle, or future plans may mean that your existing terms are no longer the best fit. This is also when you can negotiate improved terms or explore switching lenders if more competitive options are available.

Before renewing, take stock of your current situation and what the next few years may look like. Questions to consider include:

• Has your household income increased, allowing you to pay down your mortgage faster?
• Have you experienced a reduction in income or job changes?
• Are new expenses on the horizon, such as childcare, education costs, or other major commitments?
• Is there a possibility you may move before the next term ends?
• Do you expect to receive a lump sum, such as an inheritance or bonus, that could impact your mortgage strategy?

Beyond personal circumstances, broader mortgage factors should also be reviewed:

• How do current interest rates compare to your existing rate?
• Are rates expected to rise or fall during the upcoming term?
• Are you satisfied with your current lender’s service and policies?
• If considering a switch, what costs or penalties may apply?

Homeowners often consider changing lenders to reduce interest costs or improve mortgage terms. However, switching isn’t always the right move for everyone.

Potential advantages may include:

• More favourable interest rates
• Increased flexibility with prepayment or refinancing options

Potential drawbacks may include:

• Additional paperwork and underwriting requirements
• Different qualification standards
• Fees such as appraisal costs, transfer or assignment fees, administrative charges, and setup fees
• Legal or notary fees

Even if you prefer to stay with your current lender, exploring alternative offers can work to your advantage. Comparing rates, features, and terms available in the market—or working with a mortgage broker to do so—can provide leverage when negotiating renewal terms and help ensure you’re getting a competitive mortgage moving forward.