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Mortgage Renewal Calculator (Canada)
Your term is ending and rates have changed. See your new payment, the payment shock in dollars, and how a lump-sum prepayment or a longer amortization softens it.
Your Renewal
Results
Your options, compared over the new term
| Scenario | Payment | Interest over term | Balance at term end |
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About this calculator
Canadian mortgages renew every term: your remaining balance is re-set at current rates and re-amortized over your remaining amortization. This calculator computes your new monthly payment (using Canada's semi-annual compounding), compares it with what you pay now, and shows the interest you'll pay over the new term. It then compares your levers side by side: renewing as-is, making a penalty-free lump-sum prepayment first, extending your amortization to lower the payment, or both.
The scenario table is the heart of it. Extending your amortization lowers the monthly payment but adds interest and slows your payoff, while a lump sum lowers both the payment and the interest. Seeing all four numbers side by side is what makes the trade-off obvious.
Renewal FAQ
What happens when my mortgage term ends?
Your lender must send a renewal notice before the term ends. If you do nothing, many lenders auto-renew you, often at a posted rate worse than what a new customer gets. You're free to negotiate or move to another lender; treat the renewal letter as an opening offer, not a bill.
Do I have to requalify or pass the stress test at renewal?
Renewing with your current lender requires no requalification. Switching lenders involves a new application, though straight switches (same balance and amortization) are now generally exempt from the stress test. This is exactly why current lenders count on inertia; shopping around is usually worth an hour of your time.
Is it worth making a lump-sum prepayment right before renewal?
At renewal you can prepay any amount penalty-free. Every dollar prepaid shrinks the balance being re-set at the new (usually higher) rate, so it does double duty: a lower payment and less interest for the whole new term. If you have idle cash earning less after tax than your new mortgage rate, it's one of the best guaranteed returns available.
Should I extend my amortization to lower the payment?
Extending (say from 20 back to 25 years) can meaningfully soften payment shock, and with 20%+ equity many lenders allow it at renewal. The cost is more total interest and a slower payoff, which the scenario table quantifies. A middle path many people miss: extend for breathing room, then use prepayment privileges in good months.
Does this apply to US mortgages?
No. US fixed-rate mortgages keep one rate for the whole 15 or 30 years and never renew; the US equivalent decision is refinancing. This tool is built for the Canadian renewal cycle.