Renewal vs. refinance calculator
One keeps things simple and cheap. The other restructures everything. Put both on the screen and let the numbers argue it out.
Compare the two moves
Other debt you would roll in
Results
Which move winson total monthly obligation
A straight switch keeps your loan and amortization unchanged and is stress-test exempt. A refinance increases the loan, must pass the stress test, and is capped at 80% of value. Lower monthly is not automatically better — check the extra interest line.
Results are estimates for illustration only, calculated with Canadian semi-annual compounding. They are not an offer of credit, do not include property tax, condo fees, insurance or closing costs unless stated, and your actual rate and approval depend on your credit, income, property and lender. August 2026 rates.
Placed with Canada's banks, monolines, credit unions and alternative lenders
Lender names shown for reference. Availability, pricing and guidelines vary by province, property and borrower profile.
Renewal or refinance — the question behind the question
At maturity you have two genuinely different options. A straight switch moves the same balance and the same amortization to whichever lender is cheapest. A refinance restructures: more money, a longer amortization, other debt folded in.
The switch is cheaper, faster, and stress-test exempt. The refinance is the more powerful tool and costs more to use. The right answer depends entirely on whether your problem is the mortgage rate or the total monthly obligation.
| Straight switch | Refinance | |
|---|---|---|
| Best when | Your only problem is the rate | Cash flow, consumer debt, or you need cash |
| Stress test | Exempt (uninsured, federally regulated) | Applies |
| Maximum | Existing balance | 80% of appraised value |
| Amortization | Unchanged or shorter | Can be reset |
| Cost | Often nil — lender frequently covers it | $1,000–$1,800 legal, plus appraisal |
| Timeline | 1–3 weeks | 3–5 weeks |
| Credit impact | Minimal | Usually improves as revolving balances clear |
The trap in the lower payment
Refinancing almost always produces a lower total monthly obligation, because it converts short-amortization consumer debt into 25-year mortgage debt. That is real relief and it is often the right call. It is also a longer runway of interest on the amount you rolled in.
The calculator's extra interest cost of the longer amortization line is there to keep you honest. If you take the freed-up cash flow and direct part of it back at the mortgage through prepayments, you get the relief without the long tail. If it disappears into the same spending that created the debt, you have refinanced the problem rather than solved it.
The discipline that makes it work. Whatever the refinance frees up per month, commit a fixed share of it — a third is a reasonable target — to a permanent payment increase or an annual lump sum. Set it up the same week the mortgage funds, before the money finds another use.
When the refinance does not fit
If the new loan would exceed 80% of value, an A-lender refinance is off the table. That does not end the conversation — it changes the tool.
- Straight switch plus a second mortgage. Keep the cheap first mortgage, add a second behind it for the cash. Total borrowing can go higher than 80% this way, at a higher rate on the second.
- Alternative (B) lender refinance. Still capped at 80%, but with more flexible income and credit rules — roughly one to two percent above bank rates plus a lender fee.
- Wait and prepay. If you are close to 80%, a few months of aggressive prepayment can bring the file inside the limit.
- Reconsider the amount. Sometimes only part of the debt actually needs to be consolidated to fix the cash flow.
What to have ready before you compare
Bring those five things and a broker can model both routes properly in a single conversation — including the option most people never hear about, which is doing a straight switch now and refinancing later once something in the file has improved.
- Your mortgage renewal letter and a payout statement showing the exact maturity balance and remaining amortization.
- A current statement for every other debt: balance, rate, and minimum payment.
- A realistic sense of your property value — we can run an automated valuation at no cost before anyone orders an appraisal.
- Two years of income documents, or the equivalent if you are self-employed.
- Your renewal date. Everything is easier 120 days out than 20 days out.
Estimates are free. So is the real answer.
Send us the file and we will run it against our full lender panel, confirm the rate you actually qualify for, and tell you whether the move is worth making.
Turn the estimate into a real quote
A calculator uses assumptions. A broker uses your actual file.
Frequently asked questions
Renewing (or straight-switching) keeps the same loan amount and amortization and simply signs a new term, potentially with a new lender. Refinancing replaces the mortgage with a larger one, up to 80% of your home's value, and can reset the amortization. Renewal is a rate decision; refinancing is a restructuring decision.
Yes, for uninsured mortgages moving between federally regulated lenders, provided the loan amount does not increase and the amortization is not extended. This has been the rule since November 21, 2024, and it is the single biggest reason more Canadians can move lenders at renewal than realise.
Not into the first mortgage — adding debt makes it a refinance by definition. The alternative is to straight-switch the first mortgage at the best available rate and place a second mortgage behind it for the consolidation. That is often cheaper overall than breaking a good first mortgage.
Usually the refinance, because paying revolving balances down to zero removes the utilization drag that is one of the heaviest inputs into a bureau score. The improvement typically shows up within one to two reporting cycles, which matters if you plan to apply for anything else soon.
It can, and that is the point of the tool — but it is optional. You can refinance and keep your existing remaining amortization, which raises the payment relative to a reset but saves substantial interest. Ask for both versions before you decide.
We run an automated valuation model on your address before anyone orders a paid appraisal. It is not a guarantee, but it tells you within a reasonable band whether the refinance fits inside 80% — and it costs you nothing.
Yes, but breaking a closed mortgage mid-term triggers a penalty: three months' interest on a variable, or the greater of three months' interest and the interest rate differential on a fixed. Use the refinance calculator to test whether the penalty is worth paying.
You are not necessarily stuck. Many lenders allow a signed renewal to be cancelled before the maturity date, and after maturity you can still switch or refinance subject to a penalty. Call before you assume the door is closed.
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