If you’re renewing your mortgage this year, you’re not alone. According to the Canada Mortgage and Housing Corporation, about 1.15 million Canadian households will come up for renewal in 2026—one of the largest renewal waves in the country’s history. And most of them will face higher payments: the Bank of Canada estimates that owners of five-year fixed-rate mortgages will pay, on average, 15–20% more than in December 2024.
At the same time, the Bank of Canada on Wednesday kept the policy rate at 2.25%, citing rising energy prices and pressure from U.S. tariffs. There’s no reason to expect a saving rate cut anytime soon.
What should you do? Here are five practical steps.
1. Start shopping 120 days before renewal
This is the most underrated advice. Most lenders offer a rate hold four months before your renewal date—meaning you lock in a guaranteed rate while still keeping the option to keep looking if rates fall.
Automatically renewing with the same bank on the terms that arrived in the mail is almost always a mistake. The first offer is rarely the best. According to Equifax Canada, 56% of mortgage borrowers plan to consider switching lenders at renewal.
An important change: since November 2024, when switching to a new lender at renewal, you generally no longer need to pass the federal stress test. This matters a lot if your income or credit history has changed since you first took out the mortgage.
2. Honestly assess your entire financial situation
Before locking in a higher rate for five years, run the numbers for the whole household—not just the mortgage line item. If the new payment will consume a larger share of income than you can sustainably afford, a longer amortization or a different term structure may matter more than chasing the lowest rate.
It’s cash flow that keeps you out of crisis—not a nominally low rate.
3. Choose a term based on your cash flow, not forecasts
A shorter term—say, three years—lets you renew sooner, which is beneficial if rates move down. A five-year term provides payment stability—important if your budget is tight and you can’t afford surprises. A variable rate adds flexibility, allowing you to exit the contract if rates drop significantly.
There’s no one universally correct answer. Choose not based on assumptions about where rates are headed, but on how much uncertainty you can realistically tolerate.
4. Ask your lender for help—before problems arise
If the new payment truly doesn’t fit your budget, don’t wait for the first missed payment. Back in July 2023, the Financial Consumer Agency of Canada set obligations for federally regulated lenders to support borrowers in difficulty: waiving prepayment penalties, removing internal fees, prohibiting interest-on-interest charges, extending amortization.
The problem is that banks don’t always offer these tools on their own—you have to ask. The best time to talk is before you’re in crisis, not after. According to a TD survey, 67% of homeowners feel anxious about the upcoming renewal, and 56% are already cutting household spending to cope with higher payments.
5. Use renewal to clear other debts
Renewal is one of the rare moments when you can refinance and restructure debt without penalties. If you have credit card debt or a high-interest line of credit, rolling it into a refinanced mortgage can save thousands of dollars a year.
A caveat: you’re trading short-term debt for long-term debt. This works only if you truly change the behavior that created the card debt. Otherwise, in two years you’ll be back in the same place—but with a larger mortgage.
The 2026 renewal wave isn’t going anywhere, and the macroeconomic environment won’t do you any favors. But you have more tools than it seems. Start shopping early, soberly assess the full financial picture, choose a term that matches your tolerance for uncertainty—and ask your lender for help if you need it. The worst thing you can do is sign what came in the mail.
