Short answer: a "switch" moves your existing mortgage balance to a new lender, usually at renewal, without increasing what you owe or accessing equity. A "refinance" increases your mortgage amount, accesses equity, or otherwise restructures your mortgage significantly, and typically comes with more cost and a full requalification.
Mortgage Switch
- Moves your existing balance and remaining amortization to a new lender at renewal
- No increase to the amount you owe
- Often low-cost or free, some lenders cover legal and appraisal fees to win your business
- Available at renewal without a penalty, since you're not breaking an active term
Refinance
- Increases your mortgage amount to access equity, or otherwise materially changes your mortgage
- Can happen mid-term, but usually triggers a prepayment penalty if you're breaking an existing term early
- Involves a full new registration, appraisal, and legal fees
- Requires full requalification, stress test included, on the new amount
Why the Distinction Actually Matters
If you just want a better rate at renewal with no other changes, a switch is almost always the cheaper, simpler path, there's no reason to pay refinance-level costs for it. If you need to pull out equity, consolidate debt, or make a change your current lender won't offer, a refinance is the tool for that job, and it's worth budgeting for the associated costs upfront.
Not Sure Which One You Need?
Tell us what you're actually trying to accomplish, we'll tell you honestly whether a switch or a refinance gets you there. Talk to Sean.