For many homeowners across Ontario, the mortgage renewal process can bring a mix of relief and stress. On the one hand, it’s a chance to reassess your financial goals and possibly secure better terms. On the other hand, rising interest rates, changing lending rules, and market uncertainty can make the renewal process feel financially daunting.

The good news? You have options. Mortgage renewals don’t have to break the bank—and with the right strategies, you can often reduce your monthly payments, free up cash flow, and set yourself up for long-term financial success. In this blog, I’ll walk you through several practical strategies to make your next renewal more affordable, including how global factors like tariffs may impact your bottom line.

1. Don’t Sign the First Renewal Offer You Receive

When your mortgage term is coming to an end, your lender will typically send you a renewal offer a few months in advance. It might seem easiest to sign and send it back—but resist the urge. These early renewal offers are often not the best rates available.

Instead, use this as your opportunity to shop around. Lenders (including your current one) may be willing to offer a more competitive rate if they know you’re exploring other options. I can negotiate on your behalf or help you switch to another lender with more favourable terms.

2. Start the Renewal Process Early

Timing matters when it comes to mortgage renewals. Most lenders allow you to renew as early as 120–180 days before your term ends without penalty. Starting early gives you time to compare rates, reassess your financial goals, and avoid rushed decisions.

In a rising rate environment—which we’ve seen in recent years—renewing early can also mean locking in a lower rate before another potential increase. If rates are expected to climb, securing a rate early could result in significant savings over the life of your next term.

3. Consider a Shorter Term to Wait Out Higher Rates

While a 5-year fixed mortgage is often seen as the “default,” it may not always be your best choice—especially if rates are high when you’re renewing. In a high-rate environment, it might make sense to opt for a shorter term (e.g., 1 to 3 years) so you’re not locked into today’s rates for too long.

If rates drop within the next year or two, you’ll have the flexibility to renew into a lower rate sooner. This can be an effective tactic to keep your payments manageable while waiting for market conditions to improve.

4. Explore Blended or Extended Terms

Another option that some lenders offer is a blended or extended mortgage. This approach combines your existing mortgage rate with a new rate, effectively averaging them out. It can help reduce payment shock if your current rate is significantly lower than current market rates.

This strategy works well for homeowners nearing the end of their term who want to avoid a big jump in payments. However, the math can get tricky—so it’s best to have someone (like me!) run the numbers and see if it really benefits you.

5. Refinance to Consolidate Debt

If your mortgage is up for renewal and you’re carrying high-interest debt (like credit cards or personal loans), it may be a good time to consider refinancing. This means rolling that high-interest debt into your mortgage, which typically carries a much lower interest rate.

Although your mortgage balance will increase, your overall monthly payments could drop significantly. This strategy can provide relief from cash flow pressure and help you pay down debt faster.

Keep in mind that refinancing comes with legal and appraisal fees, but in many cases, the long-term savings outweigh the costs.

6. Take Advantage of Prepayment Options Before Renewal

Most mortgages in Canada come with prepayment privileges—usually 10% to 20% of the original mortgage amount annually. If you have extra cash (from a bonus, tax return, or savings), putting it toward your mortgage before you renew can reduce the principal you’re renewing on.

A lower principal means lower monthly payments or less interest paid over time. Even a small lump sum can make a noticeable difference. Ask me about the best way to use your prepayment privileges to your advantage.

7. Work With a Mortgage Strategist, Not Just a Broker

I always tell people that I’m a mortgage strategist, not just a mortgage agent—and there’s a big difference. I look at the bigger picture: your goals, your cash flow, your long-term financial health. I’m not just focused on finding you a good rate today—I’m helping you make smarter moves for tomorrow.

This kind of strategic guidance is especially important during renewals, when it’s easy to overlook better options or fall into the “just renew and forget it” mindset. I’m here to uncover creative solutions that might not be obvious but could make a big financial difference.

8. Consider Variable Rates—But Only If You’re Prepared

Variable-rate mortgages typically come with lower interest rates compared to fixed-rate ones. If you have some wiggle room in your budget and can handle a bit of payment fluctuation, switching to a variable rate at renewal could save you money.

However, variable rates come with risk, especially if the Bank of Canada raises interest rates during your term. It’s not the right fit for everyone—but if you’re financially stable and have a long-term view, it can be worth considering.

A hybrid mortgage—part fixed, part variable—is another option that offers a bit of both worlds.

9. Understand How Tariffs Can Influence Renewal Costs

You might not think international trade policy has anything to do with your mortgage renewal—but it can.

Tariffs (taxes on imported goods) can drive up the cost of living by making products and materials more expensive. For example, if tariffs are placed on U.S. goods that Canada imports (like construction materials, food, or oil), it can lead to higher inflation. And when inflation rises, so do interest rates—because the Bank of Canada often increases rates to keep inflation in check.

Higher interest rates directly impact the cost of borrowing, including mortgage rates. So, if global trade tensions result in tariffs and inflation, homeowners could find themselves renewing at higher rates. It’s another reason why I always keep an eye on the big picture—not just today’s rate sheet—when helping clients make decisions.

10. Make Your Home More Energy Efficient to Reduce Expenses

While not a direct mortgage strategy, improving the energy efficiency of your home can free up monthly cash flow—making your mortgage payments feel more affordable.

Simple upgrades like better insulation, smart thermostats, or energy-efficient windows and appliances can lower your utility bills. Some programs in Ontario even offer rebates or low-interest loans for green upgrades. These savings can add up over time and help you manage other household expenses more comfortably after renewal.

11. Budget for Higher Payments—Even If You Don’t End Up Paying Them

One of the best ways to stay ahead of your renewal is to budget conservatively. Assume your payments will increase and start setting aside the difference now. Not only will this prepare you mentally and financially for higher rates, but it’ll also give you a buffer if the worst-case scenario doesn’t come true.

If your new payment ends up being lower than expected, you’ll have extra savings you can put toward an emergency fund, prepayment, or other financial goals.

Final Thoughts: You Have More Control Than You Think

Mortgage renewals don’t have to be stressful or unaffordable. With proactive planning, a clear understanding of your options, and the right expert in your corner, you can approach renewal time with confidence and control.

My role as your mortgage strategist is to help you see around corners—not just react to today’s market, but plan for what’s ahead. If your mortgage is coming up for renewal or if you’re just looking to get a better handle on your options, I’d love to chat.

Let’s make your next mortgage renewal smarter, not scarier.
Visit www.donnamac.ca to get started or book a call with me today.