According to Mortgage Professionals Canada, more than 20% of Canadian mortgage holders are set to renew their mortgage within the next 12 months. For many Ottawa homeowners, this means transitioning off the historically low rates locked in during 2020–2021 and navigating today's very different lending environment. The good news: rates have come down substantially from their 2023 peaks, and borrowers who prepare now are in a strong position.
The Current Rate Environment at Renewal Time
The Bank of Canada has reduced its overnight rate to 2.25%, and inflation has eased considerably since the highs of 2022–2023. Both fixed and variable mortgage rates are trending in a favorable direction — not where they were five years ago, but meaningfully better than they were 18 months ago. For borrowers whose 5-year terms expire in 2026, the payment shock may be less severe than many feared.
Fixed rates, which are driven by Government of Canada bond yields rather than the overnight rate, have also come down — though they can be more volatile based on global market conditions. Shopping actively at renewal time (rather than passively accepting your lender's offer) is more important than ever.
The Single Biggest Renewal Mistake Ottawa Homeowners Make
Going on autopilot. When your renewal letter arrives from your current lender, it will almost always contain their highest available rate — not their best rate, and certainly not the best rate available in the market. Many Canadians simply sign it and move on. That convenience can cost thousands of dollars over the next term.
Your current lender's renewal offer is a starting point for negotiation — not a take-it-or-leave-it deal. And thanks to recent regulatory changes, switching lenders at renewal no longer requires re-qualifying under the stress test.
No Stress Test When Switching Lenders at Renewal
This is one of the most important regulatory changes in recent years: if you switch lenders at renewal, you do not need to re-qualify under the mortgage stress test. This opens the door to a much wider range of lenders and products than many Ottawa homeowners realize. If you have a strong payment history and good credit, you can move your mortgage to get a better rate without the same qualification hurdles that applied when you first purchased.
What to Actually Do When Your Renewal Comes Up
- Start early — 90 to 120 days out. Most lenders allow you to lock in a renewal rate 90–120 days before your term ends. Starting early means you have time to shop, negotiate, and act without pressure.
- Don't accept the first offer. Call your current lender and ask for their best rate. Then compare it against what's available through a mortgage agent across 50+ lenders.
- Review your full mortgage structure. Renewal is also an opportunity to adjust your amortization, switch between fixed and variable, access equity for renovations or debt consolidation, or change your payment frequency.
- Consider your upcoming life changes. Are you planning to move in the next 3 years? A shorter term might make more sense than a 5-year lock-in. Do you want payment certainty? A fixed rate gives you that. Renewal is the moment to align your mortgage with your current goals — not just sign on for more of the same.
Equity Access at Renewal
If your home has appreciated since you purchased — which is likely for most Ottawa homeowners — renewal is an opportunity to access built-up equity. Whether for home renovations, consolidating higher-interest debt, or other financial goals, a refinance at renewal can be structured to improve your overall cash flow while keeping your monthly payment manageable.
Homeowners with 20% or more equity may also qualify for a 30-year amortization on a conventional mortgage, reducing monthly payments and freeing resources for other priorities.
Renewal season is one of the best times to work with a mortgage agent. Book a free renewal review with Sean — no commitment required, same-day response.