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.