With over 1.2 million fixed-rate mortgages set to renew in 2025, many homeowners are wondering how to prepare for this critical financial milestone. Whether you’re in Victoria or anywhere across Canada, mortgage renewals are a chance to take control, explore new opportunities, and make the best decision for your future.
Here’s what you need to know—and the steps you can take to renew with confidence.
What Happens During a Mortgage Renewal?
At the end of your mortgage term, usually every 3–5 years in Canada, you’ll need to renew. This means either:
- Sticking with your current lender at their offered rate, or
- Shopping around for better options with a different lender.
While renewal is straightforward, the challenge for many Canadians in 2025 will be adjusting to higher interest rates compared to the historically low rates of past years. The Bank of Canada recently noted that rising rates could increase monthly payments for many homeowners. But with the right preparation, you can face these changes confidently.
As Hannah Hayworth, a REALTOR®, explains, “Think of your mortgage renewal as a financial renaissance. It’s a chance to rethink, recalibrate, and reignite your journey towards wealth-building with a broker who truly understands your vision.”
Investor Note: If you’re an investor with one or more rental properties, this is also the time to review refinancing opportunities. Refinancing can help you access equity for new investments, consolidate debt, or improve cash flow in the face of rising rates.
Why 2025 is a Pivotal Year
Between now and 2025:
- 1 in 4 Canadian mortgages will come up for renewal, according to Ratehub.
- Most of these homeowners are currently locked into rates as low as 2–3% from earlier in the decade.
- Renewals in 2025 could see rates between 4–6%, depending on market trends, as predicted by Global News.
This increase could translate into hundreds of dollars more in monthly payments, depending on your mortgage size. For example:
- A $400,000 mortgage at 2% over 25 years costs around $1,700/month.
- At 5%, that jumps to approximately $2,300/month—an increase of $600.
As Brian Ogilvie, a Associate Broker, Director, The Folio Group, notes: “The mortgage landscape is shifting, but one thing is clear: those who plan ahead are the ones who thrive. Renewal season is your chance to make the market work for you, not the other way around.”
Steps to Take Now for a Smooth Renewal
1. Review Your Current Mortgage Terms
Start by asking:
- When does my mortgage term end?
- What’s my current interest rate?
- How much do I still owe on my principal?
Why it matters: Knowing these details gives you a clear picture of where you stand and what to compare when exploring new options.
2. Start Conversations Early
Don’t wait until the last minute! Most lenders send renewal notices about 120 days before your term ends, but reaching out 6–12 months ahead gives you more time to explore your options and negotiate.
As William Johnson, a REALTOR®, explains: “The smartest financial decisions start with early conversations. Whether it’s renewing your mortgage or planning your next steps, now is the perfect time to set the stage for a stronger future.”
Who to Talk To:
- Your current lender: Understand their renewal terms and ask about rate discounts or flexible options.
- A trusted mortgage broker, like Anna Price or Scott Travelbea: Mortgage brokers can compare rates across multiple lenders, often finding better deals than going directly to a single bank.
3. Shop Around for Better Rates
Renewal is your chance to explore other lenders. Many Canadians stay with their current lender out of convenience, but switching could save you thousands over the life of your mortgage.
Pro Tip: Mortgage brokers do the legwork for you, finding competitive rates tailored to your needs. This is especially helpful in a fluctuating market like we’re expecting in 2025.
4. Prepare for Potential Payment Changes
Higher interest rates might mean higher monthly payments, so it’s important to plan ahead:
- Build a buffer in your budget to accommodate possible increases.
- Consider making prepayments now if your current mortgage allows it—this reduces the amount of principal you’ll owe when rates rise.
- Explore longer amortization periods to spread out payments and keep them manageable.
Why Early Action Pays Off
By starting the renewal process early, you:
- Give yourself more time to understand your options.
- Lock in competitive rates before potential market changes.
- Avoid the stress of last-minute decisions.
Remember: Mortgage renewal isn’t just a chore—it’s an opportunity to make your mortgage work harder for you.
Plan Ahead for a Smart 2025
At Clover Residential, we’re here to help you navigate your renewal with confidence. Our trusted partners can connect you with the best rates and terms tailored to your needs. Together, we’ll ensure a seamless and empowering experience.
Ready to get started? Contact Clover Residential today and make your mortgage renewal a step toward your future!
