Your lender is about to send you a renewal letter — if it hasn't arrived already.
It'll look official. It'll have a rate, a deadline, and a phone number to call if you have questions. What it won't have is any mention of what else is available.
That's not an oversight. It's strategy.
Why 1.8 million Canadians are in this position right now
Canada is at the peak of the mortgage renewal wave in 2026. Roughly 1.8 million mortgages are coming up for renewal — most of them locked in between 2020 and 2022, when rates were sitting between 1.5% and 2.5%. The Bank of Canada has held its policy rate at 2.25% through five consecutive decisions this year, and today's best 5-year fixed rates are sitting around 4%.
That gap is real. For most people renewing in 2026, payments are going up. CMHC data suggests roughly 60% of Canadians renewing this year will see an increase — for a typical $500,000 mortgage, the move from 2% to 4% can mean an extra $400 to $500 per month.
That increase is unavoidable. How much of it you absorb is, in part, still up to you.
What your renewal letter is actually doing
A renewal offer from your existing lender is not advice. It's a starting position in a negotiation most Canadians don't realize they're allowed to have.
Lenders operate on one predictable assumption: that most people find renewal confusing, and most people will sign the first rate they're shown rather than compare it against what's actually available. They don't offer you their best rate in that letter. They offer you the rate they believe you'll accept without asking questions.
A broker shops your file across dozens of lenders and brings you what's genuinely competitive. Even a half-percent difference on a $500,000 mortgage adds up to thousands of dollars over the term — money that stays with you rather than your lender.
What this means for your situation
If you're a fixed-rate holder: Your renewal is moving from pandemic-era lows to today's rate environment. That gap is real, but the specific rate you land at is negotiable. Compare before you commit.
If you're a variable-rate holder: Your payments have been tracking the Bank of Canada's policy rate, which has held steady at 2.25% through the year. Depending on when you locked in and what your spread is, your renewal picture may look different from what you're expecting. Run the numbers.
If your situation has changed: New income type, different employment, more debt, plans to move — any of these can affect your options. Get a full review before your renewal deadline, not after.
Beyond rate and term, renewal is also a natural moment to look at the broader picture. Whether there's equity worth accessing, high-interest debt worth consolidating, or an amortization worth adjusting — not every situation calls for a change, but you won't know until you look.
What to do before you sign
Have a broker compare your lender's offer against the market. It costs nothing and takes less time than you think.
Think about term length strategically. A 5-year fixed commits you to today's rates through 2031. A 2 or 3-year term might cost slightly more now but positions you for a different rate environment if things shift.
If your financial picture has changed since your last renewal, update your qualification picture first — not after you've already signed something.
The renewal letter is a starting point. Not a final answer.
Before you sign a renewal or make a move, it may be worth getting a second opinion: Book a call with me for a review
Marlon
This content is for informational purposes only and does not constitute mortgage or financial advice. Contact a licensed mortgage professional for advice specific to your situation. Marlon Fernando, Mortgage Alliance, FSRA #10530.
