Can I shop around instead of renewing with my bank? (Canada)

Yes, in Canada you can shop around at renewal and move your mortgage to another lender when your term ends, with no prepayment penalty. The new lender has to approve you on its own criteria, and there can be smaller switching costs. The comparison that counts is the whole offer, including whatever your current lender offers to keep you.

Why renewal is the moment to compare

Your term is the length of your mortgage contract, often five years. While the term runs, leaving your lender usually means a prepayment penalty. When the term ends, the mortgage "matures", and you can renew, switch or pay it off without that penalty. Renewal is therefore the one regular point where comparing costs you little.

Federally regulated lenders must send your renewal statement at least 21 days before the term ends (source: Financial Consumer Agency of Canada, checked October 2026). The statement window is short, so many borrowers start comparing a few months earlier. Rate holds are commonly 90 to 120 days, and brokers can often hold a rate about four months before renewal.

Switching without the stress test

The stress test checks that you could still afford your payments at a higher rate than your contract rate. Since November 21, 2024, OSFI does not expect the stress test to be applied when an uninsured mortgage moves to another federally regulated lender at renewal (source: OSFI, checked October 2026). The exemption holds as long as you do not increase the amount or the amortization, the total time to pay off the loan.

Insured mortgages can also switch at renewal without re-qualifying (source: Canadian Mortgage Charter, Financial Consumer Agency of Canada briefing note, checked October 2026). Either kind of move is a straight switch: same balance, same or shorter amortization, new lender. If you want to borrow more or stretch the amortization, the move becomes a refinance and the stress test applies. Our page on the stress test explains how it works.

The new lender still decides

A straight switch removes the stress test, not the approval. The Financial Consumer Agency of Canada notes that the new lender must approve you and may use different criteria from your current lender (checked October 2026). The new lender will generally look at your income, your credit and the property, so any switch is subject to lender approval.

What switching can cost

The Financial Consumer Agency of Canada lists costs that can include set-up fees with the new lender and an appraisal fee. The FCAC also says you can ask the new lender to cover some or all of your switching costs (source: Financial Consumer Agency of Canada, checked October 2026).

Your current lender may also charge a discharge fee, and the new mortgage has to be registered, which can involve legal costs. Many lenders cover part of these costs on a straight switch; ask each one before you compare. Our page on what switching costs goes line by line.

Shopping around and your credit

Each new application generally means a credit check. The Financial Consumer Agency of Canada says that when you shop for a mortgage, the credit bureaus treat quotes from several lenders within a 2-week window as one inquiry (checked October 2026). Keeping your comparison inside two weeks limits the effect on your credit score.

Ask your own lender too

Shopping around includes your current lender. The Financial Consumer Agency of Canada says you can negotiate with your current lender and "may qualify for a discounted interest rate that is lower than the rate quoted in your renewal letter" (checked October 2026).

A written offer from another lender gives your talk with your current lender something to work with. If your bank matches the written offer, staying may be the better result.

What to do next

To see what staying and switching would cost with your own numbers, try the renewal vs switch tool; results are estimates only, not an offer or advice. Or bring your renewal letter to us through Can your bank do better? and we will compare it with the lenders we work with.