Everyone dreams of owning their own home. Aspiring homeowners are ready to embark on this challenging journey. Part of the journey entails having to avail mortgages. Years after buying your home, a time will come when you’ll receive a letter or a call from your lender, informing you that your mortgage is up for renewal.

Many homeowners sign their mortgage renewal documents right away, without fully understanding the content of these papers and without exploring possible money-saving options. On another note, lenders love nothing more than a signed mortgage renewal. This means minimal costs for them, but what does this actually mean for homeowners like you?

 If you’re renewing your mortgage, there are a few important things you should be aware of before signing.

Essentials of Mortgage Renewal

What’s a mortgage renewal?

Your mortgage contract includes the duration for mortgage payment. This could last for several months up to five years or even a decade. This is called the mortgage term. When your mortgage term comes to an end and you sign for a new term, this is called a mortgage renewal. The mortgage term is different from the amortization period, which is the total amount of time you need to fully repay your mortgage loan.

Why do you need to renew your mortgage? 

Unless you can pay the remaining balance in full, you’ll have to renew your mortgage at the end of the term. The mortgage renewal process is an opportunity to re-evaluate your financial situation and lifestyle, as well as the terms of your contract.

At this point, your situation and priorities have changed, so the mortgage renewal process is also the perfect time to revise the length of your term, renegotiate interest rates and even reconsider your lender. During this process, you’ll be able to adjust your mortgage according to your needs and priorities, while also considering the housing market and the economy at large.

3 Things to Do Before Renewing Your Mortgage

In order to get the mortgage agreement that’s best for your situation and goals, here are a few things to consider before renewing.

1. Planning your next 5 to 10 years

When renewing your mortgage, you need to consider your future plans to assess your needs and prepare for possible obstacles. By this time, you’ll have the opportunity to choose your mortgage term.

You’ll also need to consider your family’s plans. For instance, if you’re planning to move to a new location, an open mortgage might be best for you. On the other hand, if you’re planning to have a major renovation, you might want to find the shortest mortgage term for you or consider refinancing.

2. Financial situation and responsibilities

To identify how much you need to pay in the coming years and how much flexibility you have with your budget, you’ll have to clearly lay out your income and expenses. You can start by calculating your monthly expenses for vehicles, credit cards, loans, utilities, taxes and other home-related expenses.

After analyzing your financial situation, you’ll be able to identify what mortgage type suits you. You may opt for a fixed rate if you want your payments to stay the same throughout the term. If your budget is more flexible, you may want to consider a variable rate mortgage.

3. Housing market conditions

Recent events have taught us how constant change is. A concrete example is how the housing market and the economy were greatly affected by the pandemic. In renewing your mortgage, you’ll definitely need to consider fluctuations in the housing market.

We’ve seen how economic conditions can easily be subjected to drastic changes. In order to have a full understanding before making a major decision, it’s advisable to consult with your mortgage broker. 

Money-saving Tips on Mortgage Renewals

Now that you’re more prepared, go the extra mile and keep the following tips in mind:

1. You have the power to negotiate

It’s frustrating to know that some lenders may not give you their best rate from the start. Knowing that customers are usually hesitant to negotiate and look for other options, some lenders may offer higher rates.

Since you already have a comprehensive view of your finances, you’re now capable of determining your plan of action.

2. Look beyond the “lowest rates” and “good deals”

Don’t get easily enticed by extremely low rates. Although rates offered online or in advertisements may appear to be appealing, but tread carefully and read the fine print.

3. Seek professional guidance

It’s extremely important to seek professional help when it comes to your biggest investment.

Mortgage brokers have access to numerous lending partners that you can choose from. In this way, you can get mortgage advice and search for the best deals and rates that you can maximize, based on your needs. 

4. You have the option to switch to other lenders

The idea of going through a whole new process often intimidates some people. Switching to a different lender with a better offer can be rationalized by the fact that the process of switching to a better lender is not really difficult or expensive.

In the end, the savings you’ll receive from switching should outweigh the resources spent. 


As we all know, you shouldn’t leave your renewal to the last minute. Life happens with some unexpected twists and turns. When you’re about to undergo a mortgage renewal come prepared. The more prepared you are, the better the outcome will be.  

It’s best to engage with a mortgage expert. Before renewing, consult with Daisy Raouph, a mortgage broker and financial security advisor based in Toronto. Daisy Raouph will help you assess your financial situation and find the most suitable deal for you. 

Get started with Daisy Raouph today