🏡Renewing Your Mortgage? Here’s How to Save $3,000+

📌  Building a Project Management Career in Canada

This week, we spotlight Michael Ukachukwu’s journey into project management. Michael shares how he leveraged his engineering background, obtained certifications (like PMP), and honed his skills to break into the Canadian job market. It’s an inspiring read for anyone looking to grow a career from the ground up in a new country.

📖 Read his full story

Mortgage Renewal 101 (and How to Get the Best Deal)

In Canada, when you buy a property, you typically pay a portion of the price upfront (called a down payment) and borrow the remaining amount through a mortgage. You then repay this loan over time, with interest.

The minimum down payment varies based on the home's price. For example, it's 5% for homes under $500,000. There’s also an Amortization Period, which is the total length of time you'll take to pay off your mortgage, commonly up to 25 years.

Unlike some countries where the interest rate is fixed for the entire loan duration, in Canada, the mortgage term (the period your interest rate is fixed) is typically shorter, often 1 to 5 years. After each term, you'll need to renew your mortgage, which may involve negotiating new terms or interest rates.

Why is Mortgage Renewal Important?

Mortgage renewal happens when your current mortgage term ends and you sign a new contract for the next term. Instead of simply signing whatever your bank offers, it pays to be proactive – don’t let it auto-renew without a review! In fact, a common mistake you want to avoid: waiting until the last minute or accepting the first offer (which may have a higher posted rate). Here are 4 proven strategies to lower your rate and save money at renewal time:

• Start early: Begin shopping and talking to your lender 3-4 months before your renewal date. Banks are legally required to send a renewal notice 21 days before term-end, but you’ll get a better deal by starting much sooner. Early prep gives you time to compare rates and avoid a rushed decision.
  

• Assess your finances: Review how your financial situation has changed. If your income has gone up, you might opt for higher payments to pay off your mortgage faster. Or, if you need breathing room, you could extend your amortization or switch from variable to fixed rate – whatever fits your needs now.
  

• Make prepayments: If you have extra savings, consider putting a lump sum toward your principal before renewal. Reducing the principal loan amount can lower the interest you’ll pay going forward (just be mindful of any prepayment limits in your current mortgage to avoid fees).
  

• Negotiate & compare offers: Don’t settle for the first rate you’re offered. Negotiate with your current lender – ask if they can do better. At the same time, shop around with other banks or use a free mortgage broker (yes, brokers are typically paid by lenders, not you!). Getting multiple quotes gives you bargaining power. If you find a lower rate elsewhere, ask your bank to match it, and if they won’t, be ready to switch lenders for a better deal.

🏦 When and how to negotiate? Timing is key: many lenders allow early renewal up to 4-6 months out without penalty, so start the conversation early. Be polite but assertive in asking for a better rate or favorable terms (like a flexible prepayment option). Lenders want to keep your business, so let them know you’re comparing options. By doing your homework and negotiating, you can confidently renew your mortgage and potentially save thousands of dollars over the next term.

🧠 PRO TIP: Never auto-renew. Many lenders default to shorter terms with higher rates. That’s how banks make billions and shortchange you.

🛠️ Tool to use: Mortgage Calculator – run your numbers with higher or lower rates before deciding.

🛠️ Tools & Resources

• Settlement.Org – Government-vetted help on housing, banking, legal rights.

• Credit Karma Canada – Track your credit score for free, understand how to improve it (essential before negotiating mortgage or loans).

• Ratehub – Compare the latest renewal offers from over 30 lenders.