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Mortgage Renewal Calculator

Calculate your monthly mortgage renewal payments in Canada and evaluate different scenarios to minimize your borrowing costs.

How to use our mortgage renewal calculator

  1. Mortgage Amount – Enter your mortgage amount. At the time of renewal, it is the remaining mortgage balance you are liable to pay your lender.
  2. Amortization – Enter the period over which you will repay the remaining amount to your mortgage provider.
  3. Mortgage Rate – Enter the interest rate at which you will secure your remaining mortgage amount. Use this section to compare your existing interest rate with the new rate.
  4. Payment Frequency – Enter the frequency at which you will be releasing funds from your account.
  5. Total Monthly Mortgage Payment – This result is the amount of payment you will need to make each payment cycle.

Complete selections for
each scenario

Mortgage amount
$
Scenario 1
Scenario 2
Amortization
Years
Years
Mortgage rate
%
%
Payment frequency
Total Monthly
Mortgage Payment:
Scenario 1 - Amortization 25 Years Mortgage rate - Payment frequency Monthly
Scenario 2 - Amortization 25 Years Mortgage rate - Payment frequency Monthly
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Written By Shivani Kaul

Content Manager

Updated

What is a mortgage renewal calculator?

A Mortgage Renewal Calculator is a tool devised to assist you in your mortgage renewal process. This calculator helps you to compare your existing mortgage rate and payments with a new suggested mortgage rate offered to you by your mortgage provider.

The calculator is easy to use and helps you compare two different scenarios that you may be in at the time of your mortgage renewal.

We, at RATESDOTCA, aim to simplify this process for you and help you take an informed decision, which is a big expense in your budget.

The calculator generates different scenarios depending on your inputs like mortgage amount, amortization period, payment frequency, and interest rate.

What is mortgage renewal?

As a homeowner, you must be aware that your home loan comes with a specific period called the mortgage term. When that term ends, you have an option to either pay off the remaining mortgage amount or renew your term.

In case you decide to renew your mortgage term with your current mortgage provider, you will have to fill up a form with that lender within 30 days of the term ending.

If you decide to go with another mortgage provider, get ready for a credit check and make sure you have all the documentation at hand like proof of income, employment, among others. The renewal process could take several days, especially in case of going with a new lender, so it’s advisable that you start it 2-3 months before your term is scheduled to end.

Renewal at term end does not involve breaking your mortgage contract, unlike in refinancing, so you do not have to worry about paying a penalty fee to your existing provider. You could also take this time to shop around and compare the best available rate fitting your needs.

Understanding your renewal calculator result

Mortgage payment constitutes a sizable chunk of expenditure for any homeowner’s budget, and it is important to understand how your mortgage payment will change upon renewal.

Using a mortgage renewal calculator gives you a glimpse into what your future payment would look like and how you could manage your finances better depending upon your scenario.

In the last years, interest rates have changed drastically due to Bank of Canada’s overnight rate changes and it has impacted homeowners in a big way, in majority cases, burning a huge hole in their pockets on top of grueling inflation.

Let’s understand how to use this renewal calculator to your advantage.

  • Begin by entering your outstanding mortgage amount at the time of renewal in the Mortgage Amount section. This is the remaining amount after your term ends on existing mortgage.
  • You can choose a desired amortization period and compare it with another period of your choice. This can range from 1 year to 30 years, with the most selected amortization period being 25 years.
  • With rising interest rates, it is imminent now more than ever to compare and choose the rate best fitting your needs. Interest rates vary, depending on the type of mortgage or mortgage providers. It is best to compare the rates available to you. A rate comparison site like RATESDOTCA can help you compare and find the best rates for you. Enter the best rates available to you in the calculator and compare the difference it could have on your payments.
  • By identifying the frequency at which you want mortgage payments debited from your checking account, you will get a clear picture of your expenditure each month. Comparing scenarios, for instance monthly payments vs. Bi-monthly or weekly, could help you in your financial planning process.
  • The calculator will generate the results depending upon your inputs. You could change the scenarios as per your requirements and identify the best option available to you. By doing this, you not only will be able to make better financial decisions, but also predict your future expenses better.

How can the mortgage renewal calculator help you?

RATESDOTCA’s Mortgage Renewal Calculator will help you take better financial decisions by letting you compare your available interest rates, amortization period and payment schedules. Mortgage renewal can be stressful, especially now when interest rates are historically high, and homeowners are scrambling to beat inflation. The onus is on mortgage providers to help their customers by providing competitive mortgage rates. A rates comparison site like RATESDOTCA can help you make an informed decision by finding the best rate available to you as per your financial needs.

Mortgage renewal vs. refinance

When your mortgage term ends, you could choose to renew your existing mortgage with your existing lender or refinance completely with a new lender. The option you choose will depend on your financial situation, interest rates and mortgage market.

Mortgage renewal

  • If you choose to renew at the end of your mortgage term, you basically decide to keep paying your existing mortgage with the same lender only with new terms and conditions.

  • You cannot access the equity in your home for other expenses like renovations in case of mortgage renewal.

  • Credit check is not required if you decide to renew with your existing lender.

  • Generally, many lenders will charge a penalty if you decide to do an early mortgage renewal prior to the six months before the end of a term. But if interest rates are really low you could save hundreds of dollars in the long run on your mortgage.

Mortgage refinancing

  • Mortgage refinancing allows you to explore the rates from different lenders, compare and choose the best rates and terms and conditions for your mortgage.

  • You can use the equity in your home generated since the property was purchased for renovations. This could enable you to invest in a second property.

  • A new lender would go for full credit check, employment details, loans, etc. if you approach it for refinancing your mortgage.

  • Refinancing means you will have to renegotiate your mortgage terms and it can be challenging for some and lead to penalty. But if you are getting a handsome equity on your property you might want to use that toward another investment.

Tips on renewing your mortgage

Mortgage renewal could be a great opportunity for homebuyers to save up in case interest rates go down. It is also an opportune time to renegotiate on the terms and conditions of your mortgage.

Compare rates

You could be in a loss if you do not negotiate and compare rates available in the market. It may sound hassle free to just continue in your existing mortgage but if you want to save money in the long term, look for the best rates available to you. At RATESDOTCA, we can help you compare the best rates. You can find out easier and faster if a renewal at a better rate is possible than simply shopping around on your own. A mortgage broker will be able to assist you too in negotiating the best rate for you.

Decide sooner than later

Your mortgage lender will ask you 30 days before your term ends to renew your morgtage, but do not wait till the last minute. You can start your research and negotiate 120 days before your term ends, and identify the lowest rates available to you. You could also save on paying penalties if you negotiate your new rate before time.

Understand your mortgage better

Keep a tab on what rates are available in the market – variable and fixed – as well as the time period. Do your research before you renew your mortgage. Do your math or seek help from a mortgage advisor to help take the right decision.

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