11 Jul

The New $50,000 GST Rebate for First-Time Buyers: Who Qualifies and How to Stack It With a 30-Year Amortization

Mortgage Tips

Posted by: Ted Vailas

If you’re a first-time buyer looking at a newly built home, Ottawa just handed you one of the biggest incentives in years. The First-Time Home Buyers’ GST/HST rebate — which received Royal Assent in March 2026 — can refund up to $50,000 of the GST paid on a new home. And it doesn’t stand alone: paired with 30-year insured amortizations and the $1.5 million insured mortgage cap, first-time buyers in 2026 have a genuinely different math problem than buyers did just two years ago.

Here’s how the rebate works, who qualifies, and how to combine all three programs.

What the rebate actually pays

The rebate applies to the 5% GST (or the federal portion of HST) on a newly built home purchased from a builder, an owner-built home, or a share in a new co-operative housing project.

The amount depends on the price of the home:

  • Up to $1 million: the full GST is rebated. On an $800,000 new build, that’s $40,000 back. At $1 million, you hit the maximum $50,000.
  • Between $1 million and $1.5 million: the rebate phases out in a straight line — you lose $10,000 of rebate for every $100,000 above $1 million. A $1.25 million home gets a 50% rebate, or up to $25,000.
  • $1.5 million or more: no rebate.

If your new home is in Ontario, there’s a second win: a provincial top-up rebate on a portion of the 8% provincial part of the HST, which can be claimed at the same time as the federal rebate.

One practical note: many builders advertise prices with GST “included” and net of rebates they expect to claim on your behalf. Before you sign, get clear on whether the price reflects the rebate — it changes both your true cost and your down payment math.

Who counts as a first-time buyer

The CRA’s definition is stricter than most people assume. You must meet all of the following:

  • Be at least 18 and a Canadian citizen or permanent resident
  • Not have lived in a home that you or your spouse/common-law partner owned, as your primary residence, in the calendar year you take ownership or in the previous four calendar years
  • Neither you nor your spouse has previously received this rebate

That four-calendar-year lookback trips people up. If you sold a home in June 2022 and take ownership of a new build in August 2026, you are not eligible — 2022 falls within the previous four calendar years. Take ownership in early 2027 instead, and you qualify. For buyers near the boundary, the closing date can be worth tens of thousands of dollars.

Note the test also applies to your spouse’s ownership history — if your partner owned a home you lived in during the lookback window, neither of you qualifies, even if the new home is in your name alone.

The home has to check boxes too

The rebate is for new construction only — resale homes don’t qualify. Eligible purchases include newly built or substantially renovated homes from a builder (detached, semi, townhouse, or condo), owner-built homes, new homes on leased land (20-year-plus lease or option to buy), and new co-op units.

Timing rules apply: your purchase agreement must be signed on or after March 20, 2025 and before 2031, construction must be substantially completed before 2036, and you must be the first person to occupy the home and use it as your primary residence. Investment properties don’t qualify.

Stacking it: the 30-year amortization and the $1.5M insured cap

The rebate is one leg of a three-legged stool for first-time buyers:

1. 30-year insured amortizations. First-time buyers can take a 30-year amortization on any insured purchase — and for new builds, it’s available even to repeat buyers. The longer schedule cuts your monthly payment meaningfully, though you’ll pay more interest over the life of the mortgage and a modest insurance premium surcharge.

2. The $1.5 million insured price cap. Since December 2024, you can buy with less than 20% down on homes up to $1.5 million (it used to be $1 million). Minimum down payment is 5% on the first $500,000 and 10% on the balance.

3. The GST rebate on top.

What that looks like on a real purchase

Take a first-time buyer purchasing a $900,000 new-build townhome:

  • GST rebate: up to $45,000 of GST relief (5% of $900,000)
  • Minimum down payment: $65,000 (5% of $500K + 10% of $400K) — insured, thanks to the $1.5M cap
  • 30-year amortization: on the roughly $860,000 insured mortgage (including the insurance premium), stretching from 25 to 30 years trims the monthly payment by several hundred dollars at today’s rates

Two years ago, this same buyer would have needed 20% down ($180,000), qualified only for a 25-year amortization, and received no federal GST relief. The programs compound.

Watch-outs before you sign

  • You still need to qualify. The stress test applies — you’ll be tested at the higher of your contract rate plus 2% or 5.25%, with the usual debt-service and credit requirements.
  • The rebate isn’t automatic. Either the builder credits it to you at closing or you apply to the CRA yourself. Confirm which, in writing.
  • One rebate per couple, ever. If either spouse has claimed it before, it’s gone.
  • Timing is strategy. The ownership-transfer date determines your first-time-buyer status. If you’re close to the four-year boundary, talk to a professional before you commit to a closing date.

The bottom line

For the right buyer — a true first-timer purchasing a new build under $1 million — this rebate is as close to free money as federal housing policy gets. But the eligibility rules are precise, the phase-out math matters above $1 million, and how it interacts with your down payment, amortization, and closing date is exactly the kind of thing worth mapping out before you sign a builder’s agreement.

Thinking about a new build? Let’s run your numbers — the rebate, the down payment, and the payment on a 30-year amortization — before you commit. Contact me for a no-obligation review of your options.

Ted Vailas is a mortgage broker with Dominion Lending Centres. Rates and program details change — this article reflects rules as of July 2026 and is general information, not financial advice.

Sources: CRA — What is the FTHB rebate · CRA — Who can apply · Department of Finance announcement · Ratehub — 30-year amortizations

10 Jul

Renewing Your Mortgage in 2026? Why Payments Are Jumping $622 a Month — and How to Pay Less

Mortgage Tips

Posted by: Ted Vailas

If your mortgage comes up for renewal this year, you’re in good company — and, unfortunately, in for some sticker shock. Canada’s long-anticipated renewal wave has officially peaked, with roughly 1.8 million mortgages renewing in the 12 months surrounding mid-2026. Most of those borrowers locked in five-year fixed rates of 2.5% or less back in 2020–2021. Today, the best five-year fixed rates sit around 4%.

The result? According to Ratehub, fixed-rate borrowers renewing this spring are paying an average of $622 more per month — a 24% jump. But here’s the good news: that “average” includes a lot of people who simply signed the renewal letter their bank mailed them. With the right strategy — and a recent rule change most homeowners don’t know about — you can renew for far less. Here’s how.

Why 2026 Renewals Hurt So Much

The math is simple, even if it isn’t pleasant. A homeowner who took a $500,000 mortgage at 2.5% in 2021 is renewing into a market where rates are roughly 1.5 percentage points higher. On that mortgage, moving from 2.5% to 4.0% adds roughly $300 or more to the monthly payment — more if your balance is larger or your original rate was lower.

The Bank of Canada has held its policy rate at 2.25% since October 2025, and most economists expect it to stay there through the rest of 2026 — with the next announcement coming July 15. That means the rates on offer today are likely close to the rates you’ll see at your renewal date. Waiting and hoping for a big drop is not a strategy.

The Rule Change That Works in Your Favour: No More Stress Test on Switches

This is the single biggest opportunity for 2026 renewers, and many still don’t know about it.

Since November 2024, OSFI no longer requires federally regulated lenders to apply the mortgage stress test when you switch lenders on a straight renewal of an uninsured mortgage — same balance, same amortization. Before this change, many homeowners felt trapped with their existing bank because they couldn’t requalify at the stress-test rate. Now you can shop your mortgage across every lender in the market without re-proving your income against a rate 2% higher than what you’ll actually pay.

Translation: your bank’s renewal letter is now competing with the entire market, whether they like it or not.

5 Ways to Pay Less at Renewal

1. Never sign the first renewal letter

Your lender’s renewal offer is rarely their best rate — it’s the rate they hope you’ll accept without shopping around. Signing it can also lock in the new (higher) rate immediately, costing you your remaining months at your old low rate. Read it, then set it aside.

2. Start 120 days early

Most lenders will hold a rate for up to 120 days. Starting four months before your renewal date lets you lock today’s rate as insurance — if rates rise before your renewal, you’re protected; if they fall, you take the lower one. Homeowners who wait until the final month almost always pay more.

3. Shop the switch

On a $600,000 mortgage, moving from a posted renewal rate of 5.25% to a discounted 4.60% saves roughly $3,900 a year — nearly $19,500 over a five-year term. A mortgage broker can shop dozens of lenders at once, including monoline lenders that often beat the big banks and cover switching costs.

4. Consider variable — the gap is the widest in years

The best five-year variable rates are around 3.45%, nearly a full point below fixed. With the Bank of Canada expected to hold steady, variable-rate borrowers keep that saving from day one — though you should be comfortable with the (small but real) risk of a hike in late 2026 or 2027.

5. Extend your amortization if cash flow is tight

If the new payment strains your budget, re-extending your amortization at renewal lowers the monthly payment. You’ll pay more interest over time, but you can shorten it again later with prepayments once rates or your finances improve. It’s a pressure valve — better than falling behind.

What This Means for You

A 2026 renewal doesn’t have to mean a $622 payment shock. The homeowners who pay the most are the ones who sign the first offer; the ones who pay the least start early, shop widely, and use the new no-stress-test switch rules to their advantage.

Your renewal is likely the single biggest expense decision you’ll make this year — it deserves more than a signature on a form letter.

Renewing in the next 12 months? Send me your renewal date and current rate, and I’ll shop the market for you — at no cost to you. Contact me here or call 204-890-2446 for a free renewal review.

4 Jul

Bank of Canada Rate Decision July 15: Should You Lock In Before the Announcement?

General

Posted by: Ted Vailas

On July 15, 2026, the Bank of Canada will make its next rate announcement — and if your mortgage is up for renewal this summer, or you’re holding a variable rate, you’re probably wondering whether to act before the decision or wait it out.

Here’s the short version: markets widely expect the Bank to hold its policy rate at 2.25% for a sixth straight meeting. But “widely expected” isn’t “guaranteed” — and for the first time in a while, the small chance of a surprise points up, not down. Bond markets are currently pricing in about a 5% chance of a quarter-point hike on July 15.

Let’s break down what’s going on, and what it means for your mortgage.

Where rates stand right now

The Bank of Canada’s overnight rate has sat at 2.25% since October 2025, which puts prime at 4.45% at most lenders. At its last announcement on June 10, the Bank held steady for the fifth consecutive time, citing weak economic activity and ongoing uncertainty around U.S. trade policy.

On the mortgage side, as of early July:

  • Best 5-year fixed (insured): around 3.94%–4.04%
  • Best 5-year variable (insured): around 3.30%–3.45%
  • 3-year fixed (insured): around 3.84%

That gap of roughly 0.6% between variable and fixed is why more Canadians have been choosing variable at renewal lately — CMHC’s spring report confirmed a clear shift toward variable rates as renewal pressures ease.

Why a hold isn’t a sure thing this time

Inflation has crept back up. Headline inflation hit 2.8% in the spring, driven almost entirely by an energy shock — gasoline prices have jumped roughly 29%. The good news: core inflation (which strips out volatile items like gas) actually eased to about 2.1%, and shelter inflation has cooled to 1.8%.

The Bank finds itself boxed in: inflation is too warm to justify a cut, but the economy is too weak to justify a hike. That’s why most economists expect the Bank to stay on the sidelines through the summer and possibly into fall.

Meanwhile, the 5-year Government of Canada bond yield — which drives fixed mortgage rates — has climbed 0.35–0.40 percentage points on Middle East tensions and higher oil prices, and is holding near 3%. Most forecasts see it staying in the 3.0%–3.5% range through 2026, with an upward bias. Translation: fixed rates are more likely to drift up than down in the second half of the year.

Renewing in 2026? You’re not alone

CMHC estimates 1.15 million Canadian mortgages come up for renewal in 2026. Many of those were locked in below 2% back in 2021, which means payment increases of 15%–20% on average at renewal — some as high as 25%–40%.

If that’s you, here’s the most important thing to know: you can lock in a rate up to 120 days before your renewal date, and it works like a rate cap, not a commitment. If rates fall before your renewal, you take the lower rate. If they rise, you’re protected. There’s no downside to getting a rate hold in place early.

So — should you lock in before July 15?

If you’re renewing in the next 4 months: Get a rate hold now. With bond yields biased upward and fixed rates more likely to rise than fall through year-end, a 120-day rate hold costs you nothing and protects you from a bad surprise.

If you’re currently in a variable mortgage: A July 15 hold means your payment doesn’t change. Even in the unlikely event of a hike, one quarter-point move adds roughly $13/month per $100,000 of mortgage. The bigger question is whether the variable discount (currently ~0.6% below fixed) still compensates you for the risk — for many borrowers it does, but it’s worth running your numbers.

If you’re house hunting this summer: Get pre-approved now. A pre-approval locks your rate for up to 120 days while you shop — and with markets tightening in much of the country, having financing nailed down makes your offer stronger.

If you’re deciding between fixed and variable: There’s no universal answer. Variable is cheaper today and wins if the Bank eventually cuts; fixed buys certainty in a world where inflation surprises keep pushing yields up. Your income stability, risk tolerance, and how long you’ll stay in the home matter more than anyone’s forecast. See my guide on fixed vs. variable rates.

The bottom line

July 15 will most likely be a non-event — a sixth straight hold. But the direction of risk has shifted: with inflation at 2.8% and bond yields firming, waiting for lower rates is a bet, not a plan. A free rate hold takes the bet off the table.

If your mortgage renews in 2026, or you’re wondering whether fixed or variable makes sense for you, let’s talk it through. As a Winnipeg mortgage professional with access to 90+ lenders, I’ll shop the market and find the best option for your situation — at no cost to you.

Call me at 204-890-2446 or email ted@tedvailas.com for a free mortgage review.

3 Jul

Bank of Canada Decision July 15: Why a Rate Hike Is Back on the Table for the First Time in Years

Latest News

Posted by: Ted Vailas

For nearly a year, Canadian mortgage borrowers have been asking the same question: “When will rates come down again?” Heading into the Bank of Canada rate announcement on July 15, 2026, it may be time to ask a different one: what if the next move is up?

The Bank of Canada has held its policy rate at 2.25% since October 2025. But for the first time in years, bond markets are pricing in a small chance of a rate hike — not a cut. Whether you’re buying your first home in Winnipeg, renewing this summer, or riding a variable rate, here’s what you need to know before July 15.

What’s Happening on July 15?

The Bank of Canada makes its next interest rate decision on Wednesday, July 15, 2026, at 9:45 a.m. ET, alongside its quarterly Monetary Policy Report. Markets overwhelmingly expect another hold at 2.25% — but they’re also pricing in roughly a 5% chance of a quarter-point increase, and essentially no chance of a cut.

That’s a big shift in tone. Through 2024 and 2025, every hold came with the expectation that cuts were coming. Now, most bank and economist forecasts see the Bank holding through the summer and fall, with the risk tilted toward higher rates rather than lower ones.

Why Is a Hike Even Being Discussed?

One word: inflation. Headline inflation has climbed to 2.8%, pushed up by a spike in gasoline prices of roughly 29%. That’s above the Bank’s 2% target, and central banks raise rates to cool inflation.

The good news is that domestic price pressures are actually behaving. Shelter inflation has cooled to around 1.8%. The Bank tends to look past temporary energy shocks — which is why most forecasters still expect a hold. But if high gas prices start feeding into other prices, the conversation changes quickly. Add in a contentious CUSMA (the Canada–U.S.–Mexico trade agreement) review beginning this July, and there’s real uncertainty in both directions.

What This Means If Your Mortgage Is Renewing

2026 is the biggest renewal year in Canadian history — nearly half of all mortgages, over a million households, come up for renewal this year. If yours is one of them, the “wait for lower rates” strategy has quietly expired.

Currently, insured 5-year fixed rates sit around 3.94%, 3-year fixed around 3.84%, and 5-year variable around 3.30%. If the Bank holds, those numbers likely stay put. If it hikes — now or later this year — variable rates rise immediately and fixed rates may follow.

One more thing many borrowers still don’t know: under rules updated by OSFI, if you switch lenders at renewal without increasing your loan amount or amortization, you no longer face the stress test. That means shopping your renewal is easier than it’s been in years — you’re not stuck taking your bank’s first offer.

What This Means for Winnipeg Buyers and Homeowners

Here in Winnipeg, the market isn’t waiting for the Bank of Canada. The average home price hit $427,223 in May 2026, up 3.6% from a year earlier, and detached homes set a record for the month at an average of $477,313. With about 2.2 months of supply, Winnipeg remains a seller’s market — one of the steadier markets in the country even as some larger cities are still finding their footing.

For Winnipeg buyers, that combination matters: prices are grinding higher while the era of falling rates appears to be over. If you’re pre-approved at today’s rates, a rate hold on July 15 keeps your buying power intact — but waiting for a cheaper mortgage could mean paying more for the house instead. A mortgage pre-approval locks in a rate for up to 120 days, protecting you if rates move up.

Fixed or Variable Right Now?

There’s no one-size answer, but the math has shifted. Variable rates are currently lower than fixed — attractive if the Bank keeps holding. But variable borrowers now carry hike risk for the first time in years. A 3-year fixed has become a popular middle path: it locks in certainty without committing to five years, in case rates do eventually drift lower. Your income, timeline, and stress tolerance all matter here — this is exactly the fixed vs. variable conversation worth having before July 15, not after.

The Bottom Line

The most likely outcome on July 15 is a hold at 2.25%. But the safety net of “rates will keep falling” is gone, and the smart move — whether you’re buying in Winnipeg or renewing anywhere in Manitoba — is to plan for rates staying flat and protect yourself against the chance they rise.

If your renewal is coming up in the next 12 months, or you’re thinking about buying this year, let’s talk before the Bank does. I’ll shop 90+ lenders to find the right mortgage for your situation — at no cost to you.

Call me at 204-890-2446 or apply online today.

Rates and market data cited are as of early July 2026 and subject to change. Sources: Bank of Canada, Winnipeg Regional Real Estate Board, WOWA, Mortgage Sandbox.

2 Jul

The US Economy Is Slowing: What That Means for the Bank of Canada’s July 15 Rate Decision — and Your Mortgage

Latest News

Posted by: Ted Vailas

If you’re watching your mortgage rate — and in 2026, who isn’t? — the most important economic news this week didn’t come from Ottawa. It came from Washington.

On July 2, the US Bureau of Labor Statistics reported that American employers added just 57,000 jobs in June — roughly half of what economists expected. That number matters to you, whether you’re renewing a mortgage in Winnipeg, shopping for your first home, or riding a variable rate and wondering what the Bank of Canada will do on July 15.

Here’s what happened, why US jobs numbers move Canadian mortgage rates, and what it could mean for your next mortgage decision.

What the US Jobs Report Actually Said

The June report was soft almost everywhere you looked:

  • 57,000 jobs added — well below the roughly 115,000 economists forecast
  • April and May were revised down by a combined 74,000 jobs, meaning the spring was weaker than anyone thought
  • Unemployment sat at 4.2%, but labour force participation slipped to 61.5%
  • Leisure and hospitality shed 61,000 jobs — a sign consumers are pulling back

One weak month doesn’t make a recession. But three months of fading momentum, confirmed by downward revisions, tells markets the US economy is losing steam.

Why a US Jobs Report Moves Canadian Mortgage Rates

It might seem odd that hiring in Ohio affects your mortgage payment in Manitoba. Here’s the chain reaction:

  1. Weak US data pushes US bond yields down. After the report, short-term US Treasury yields fell as traders scaled back bets that the Federal Reserve would need to raise rates this year.
  2. Canadian bond yields follow US yields. The Government of Canada 5-year bond — currently hovering around the 3% mark — tends to move in sympathy with US Treasuries.
  3. Fixed mortgage rates follow the 5-year bond. Canadian lenders price 5-year fixed mortgages off that bond yield. When it falls, fixed rates tend to follow (and when it rises, they climb).

Variable rates, on the other hand, are set by the Bank of Canada’s policy rate — which brings us to July 15.

What It Means for the Bank of Canada on July 15

The Bank of Canada has held its policy rate at 2.25% since October 2025, and it held again on June 10. Going into this week, markets overwhelmingly expected another hold on July 15 — with a small but real chance of a hike, because an energy-driven spike in gasoline prices has pushed headline inflation up to 2.8%.

That’s the tension the Bank is stuck in: inflation is too warm to justify a cut, but the economy is too soft to justify a hike.

The weak US report tilts the scale toward standing still — or eventually, toward easing. If Canada’s largest trading partner is slowing, that drags on Canadian exports, business investment and hiring, which cools inflation pressure over time. Notably, the domestic side of inflation is already behaving: shelter inflation has cooled to 1.8%. The hot part is energy, and oil prices have been falling as geopolitical tensions ease.

The most likely outcome on July 15: a hold at 2.25%, with the Bank sounding a little more worried about growth than it did in June. For variable-rate holders, that means your rate — and prime at 4.45% — likely stays put this summer.

Fixed vs Variable: How to Think About It Right Now

  • If you’re renewing or buying soon and leaning fixed: falling bond yields are your friend. Five-year fixed rates have been available around the low-4% range, and continued weak data could nudge them lower. A pre-approval locks today’s rate for up to 120 days while you watch — there’s no downside to holding a guaranteed rate.
  • If you’re on a variable: the July 15 decision almost certainly won’t raise your payment. The bigger question is whether soft US data eventually forces cuts in late 2026 — possible, but not guaranteed while energy inflation is sticky.
  • If you’re renewing in 2026: you have more power than you think. Nearly half of all Canadian mortgages renew this year, and new rules mean you no longer need to pass the stress test to switch lenders at renewal if your loan amount and amortization stay the same. Don’t sign your bank’s first offer.

The Winnipeg Wrinkle: Waiting Has a Cost Here

If you’re in Winnipeg, there’s a local twist to the “should I wait for lower rates?” question.

Manitoba remains one of the tightest housing markets in Canada, with roughly three months of inventory — compared to nearly seven in British Columbia. In May, Winnipeg’s average detached home hit an all-time record of $477,313, and June sales came in 6% ahead of the same month two years ago, with total dollar volume over $707 million.

In a buyer-friendly market, waiting for rates to drift lower costs you little. In a tight market like ours, a small rate improvement can be swallowed — and then some — by rising prices and competition for well-priced listings. If soft economic data does eventually bring rate cuts, expect sidelined buyers to jump back in quickly, and Winnipeg doesn’t have the inventory to absorb them.

The practical move: get pre-approved now so your rate is protected, then let the July 15 decision and the market come to you.

The Bottom Line

This week’s weak US jobs report makes a Bank of Canada hike on July 15 very unlikely and keeps the door open to lower fixed rates if the slowdown continues. Variable-rate holders can breathe easy this summer; fixed-rate shoppers should watch bond yields — and lock a pre-approval so they can only win from here.

Every situation is different, and the right answer depends on your renewal date, your budget and your tolerance for risk. I’m Ted Vailas, a Winnipeg mortgage professional with Dominion Lending Centres, and I shop 90+ lenders to find the right mortgage at no cost to you.

Renewing, buying or just rate-watching? Get in touch or start your application — a 15-minute conversation before July 15 could save you thousands.

Rates and market data cited are as of July 2, 2026, and subject to change. This article is general information, not financial advice.

1 Jul

Half of Canadian Mortgages Are Up for Renewal in 2026 — Here’s How to Get the Best Deal

General

Posted by: Ted Vailas

If your mortgage is coming up for renewal this year, you’re far from alone. Approximately 1.15 million Canadian households are renewing their mortgages in 2026, with another 940,000 in the queue for 2027. It’s the largest mortgage renewal wave in Canadian history — and the rate environment borrowers are renewing into looks very different from what they signed up for five years ago.

The good news? Borrowers heading into renewal in 2026 have more power than they realize. A key rule change means you can now shop for a better rate without the hurdles you once faced — and most people don’t know about it yet.

Here’s everything you need to know.

Why 2026 Is Such a Big Year for Renewals

The bulk of today’s renewal wave traces back to 2020 and 2021, when Canadians locked into rock-bottom 5-year fixed rates during the pandemic — many in the 1.5% to 2.5% range. Those terms are expiring now.

The result: borrowers renewing a 5-year fixed mortgage in 2026 are looking at average monthly payment increases of roughly $622 — a 24% jump, according to Ratehub.ca analysis. That’s a significant budget shift, and it’s happening to over a million households all at once.

If you’re on a variable rate, the story is a bit different — you’ve likely already absorbed most of the rate movement over the past few years, and your renewal payment increase will be much more modest (around 1% on average).

Either way, this is not the time to just sign whatever your bank puts in front of you.

The Rule Change That Gives You Real Power

Here’s what most Canadians heading into renewal don’t know: as of November 2024, you no longer need to pass the mortgage stress test to switch lenders at renewal.

Before this change, if you wanted to move your mortgage to a different lender to get a better rate, you had to requalify at the stress test rate (your contract rate + 2%). For many homeowners — especially those who took on more debt, changed jobs, or saw their income shift — that was a real barrier. Many felt trapped with their existing lender.

That barrier is now gone for most borrowers.

What changed:

  • Uninsured mortgages (20%+ down payment): OSFI eliminated the stress test for “straight switch” renewals — meaning if you keep your loan amount and amortization the same and simply move to a new lender, no requalification required.
  • Insured mortgages (less than 20% down): Also exempt from the stress test when switching at renewal under the same conditions.

The key condition: it has to be a straight switch. If you want to refinance, borrow more, or extend your amortization beyond the original schedule, the stress test still applies.

But for a clean renewal at the same balance? You’re free to shop — and that’s a big deal.

What You Could Save by Shopping Around

The difference between your bank’s renewal offer and the best available rate can be substantial. Ratehub.ca estimates that borrowers who shop around and switch lenders at renewal save an average of $13,857 over their mortgage term compared to those who simply accept their bank’s offer.

As of late June 2026, the best 5-year fixed rates in Canada sit around 4.04%, while the best 5-year variable rates are around 3.45%. The big banks’ posted rates are typically considerably higher. The spread between what your bank offers and what you can find through a mortgage broker is often 0.25% to 0.75% — and on a $500,000 mortgage, that gap compounds quickly.

Fixed vs. Variable: What Makes Sense Right Now?

The Bank of Canada has held its overnight rate at 2.25% for five consecutive meetings — it’s been parked there since October 2025. The next rate announcement is July 15, 2026, and markets are pricing in no change.

The Bank is stuck between two forces: inflation hovering around 3% (too high to cut) and weak GDP growth (too soft to hike). Most economists expect the rate to stay on hold through summer and into fall.

What this means for your renewal choice:

  • Variable rate: The prime rate sits at 4.45%. Variable rates are currently around 3.45% (prime minus ~1%). If the Bank of Canada eventually cuts — and most forecasters still expect modest cuts in late 2026 or 2027 — variable holders benefit automatically. Variable makes more sense if you have flexibility and can tolerate some uncertainty.
  • Fixed rate: 5-year fixed rates are near 4.04%. You get certainty for five years. If rates drift higher (possible given inflation risk), you’re protected. If rates drop significantly, you’d miss out unless you break your mortgage (which comes with penalties).

There’s no universally right answer. It depends on your financial situation, risk tolerance, and how much payment certainty you need.

5 Steps to Get the Best Deal at Renewal

1. Start early — 120 days out.
Most lenders allow you to lock in a renewal rate up to 4 months before your term ends. Starting early gives you time to compare options and avoid auto-renewal at whatever rate your bank decides to give you.

2. Don’t accept the first offer.
Your bank will likely mail you a renewal offer. It almost certainly isn’t their best rate — it’s a starting point. Treat it as one data point, not the final word.

3. Talk to a mortgage broker.
A broker has access to dozens of lenders and can quickly tell you what’s available across the market. Since the stress test no longer applies to straight switches, the field is wide open.

4. Check the math on switching costs.
Even if there’s a small discharge fee or legal cost to switch lenders, the rate savings over five years usually dwarf it. The average savings from switching is nearly $14,000 — most switch costs are a fraction of that.

5. Review your amortization.
If you’re facing payment shock, you may have the option to extend your amortization at renewal (up to 30 years for many insured borrowers). This lowers your monthly payment in exchange for paying more interest over time. It’s a legitimate tool if cash flow is tight — just go in with eyes open on the trade-off.

Bottom Line

The 2026 renewal wave is putting over a million Canadian homeowners face-to-face with a new rate reality. Payments are going up for most people — but how much they go up is partly within your control.

The removal of the stress test for switching lenders is the biggest change most borrowers haven’t heard about. It means you have real options at renewal for the first time in years. Use them.

If your mortgage is coming up for renewal in the next 12 months, reach out before you sign anything. A quick conversation can show you exactly what’s available and whether there’s money to be saved.

Contact Ted Vailas at Dominion Lending Centres — happy to walk through your renewal options at no cost.

Ted Vailas is a mortgage broker with Dominion Lending Centres based in Canada. This article is for informational purposes only and does not constitute financial advice. Always consult a licensed mortgage professional before making decisions about your mortgage.