How to Negotiate a Better Mortgage Renewal Rate

Mortgage renewals are one of the most overlooked opportunities for Canadians to save money. Nearly 60% of homeowners simply sign their lender’s first renewal offer — and end up paying thousands more in interest.

The truth is:
You can (and should) negotiate your mortgage renewal rate.
Here's how to do it effectively in 2025.

📨 1. Never Accept the First Renewal Offer

Lenders often send high initial renewal rates, hoping borrowers choose convenience over savings.
This first offer is almost never the best deal on the table.

Before signing anything, always:
✔ Compare rates
✔ Contact a broker
✔ Ask for a match or discount
✔ Get competing offers

🔍 2. Start Shopping at Least 120 Days Before Renewal

Most lenders allow you to renew 120 days early — without penalty.
This gives you time to:

• Compare rates

• Switch lenders

• Negotiate better terms

• Lock in a lower rate before the market changes

Early renewal windows are a major advantage.

⚖️ 3. Compare Rates From Multiple Lenders

Your current lender doesn’t automatically give you the best rate.
You should compare options from:

• Banks

• Credit unions

• Mortgage finance companies

• Monoline lenders

• Alternative lenders

A mortgage broker does this comparison for free and often finds lower rates than banks advertise.

💬 4. Ask Your Lender to Match or Beat Other Offers

Use competing offers as leverage.

Example script:
"I received a lower rate from another lender. Can you match or beat it?"

Lenders don’t want to lose your business — especially at renewal.
Most will improve their offer when pressured.

🧠 5. Understand the Power of Retention Rates

Lenders have retention departments dedicated to keeping clients.
They often have access to:

• Lower rates

• Special promotions

• Unadvertised discounts

Ask directly:
"Can I speak with a retention specialist?"
This can unlock rates not available to the general public.

🔄 6. Consider Switching Lenders If Necessary

If your lender refuses to offer a competitive rate, switching may save you thousands.
During renewal:
✔ No stress test is required (if your mortgage balance stays the same)
✔ No prepayment penalties apply
✔ You may qualify for a lower promotional rate

Switching gives you leverage and flexibility.

💳 7. Ensure Your Credit and Debt Ratios Are Strong

To qualify for the best renewal rates:

• Keep your credit score high (680+)

• Pay down credit card balances

• Avoid taking new loans before renewal

• Keep your job status stable

A stronger financial profile = lower interest rate offers.

📉 8. Choose the Right Mortgage Term Based on Rate Trends

For 2025, experts expect:

• Gradual rate declines

• More significant relief in 2026

This means shorter terms like 2–3 year fixed may benefit borrowers expecting future rate cuts.
Choosing the right term can save money even if the rate itself isn't the lowest.

🧾 9. Negotiate More Than Just the Rate

You can also negotiate:

• Prepayment privileges

• Annual lump-sum allowances

• Payment increase options

• Portability features

• Lower penalties

Sometimes the mortgage structure saves more money than the interest rate itself.

🔍 10. Work With a Mortgage Broker

Mortgage brokers:
✔ Compare dozens of lenders
✔ Have access to discounted rates
✔ Can negotiate on your behalf
✔ Know each lender’s renewal policies
✔ Help avoid penalties and hidden fees

In many cases, a broker can save you more than negotiating alone.

🚀 Final Thoughts: Renewal Is Your Chance to Save Thousands

Most Canadians overpay because they renew without negotiating.
But with the right preparation, you can secure a significantly better rate.

Renew wisely by:

✔ Comparing rates early
✔ Using a broker
✔ Asking for a match or discount
✔ Choosing the right term
✔ Reviewing penalties and features

A little negotiation goes a long way — especially in a high-rate environment.