Glossary
Renewal Notice
The lender's written offer of the interest rate, term, and payment terms for renewing your mortgage before it matures..
A renewal notice is the written offer your lender sends before your mortgage matures, setting out the rate, term, and payment terms on which it is willing to renew your loan. In Canada, a mortgage runs for a set term — commonly a few years — that ends on the maturity date, even though the amortization period stretches much longer. As that date approaches, the lender typically mails or posts a renewal notice so the borrower can decide what happens next.
What a renewal notice usually contains
The document is a formal offer, not a bill. It generally states the interest rate offered for the new term, which may be a posted rate or a discounted rate; the length of the new term; the payment amount and frequency; the prepayment privileges attached to the new term; and any fees, conditions, or deadlines for responding. Some lenders also include the option to change payment frequency or increase regular payments at no cost.
Why the notice matters
Signing the offer back is the easiest path, but it is rarely the cheapest. A first offer often reflects the lender's posted rate, and the lender knows many borrowers simply accept it. At maturity you are usually free to negotiate with your current lender or move to another lender, generally without the prepayment penalty that applies mid-term. Ignoring the notice has consequences too: if you do nothing, the lender may renew you automatically on the terms it proposed, and breaking that new term later can trigger a penalty.
Options when a renewal notice arrives
| Option | What it involves |
|---|---|
| Accept the offer | Sign and keep the same lender, rate, and term |
| Negotiate | Ask the current lender to improve the rate or prepayment privileges |
| Switch lenders | Move to a new lender at maturity; a collateral charge may require a refinance instead |
| Refinance or blend and extend | Change the loan amount, amortization period, or term |
A practical step is to compare the offered rate and privileges against current market options using the mortgage renewal calculator, and to start the process a few months early so there is time to gather documents and complete a switch. The mortgage renewal guide walks through the sequence in detail.
Frequently asked questions
Do I have to accept the renewal notice my lender sends?
No. A renewal notice is an offer, not an obligation. You can accept it, ask the lender to improve the rate or terms, or arrange a switch to a different lender at maturity. Reviewing the offer before the maturity date gives you time to compare options and complete any paperwork.
How far in advance do lenders send a mortgage renewal notice?
Timing varies by lender, but renewal notices are typically sent well before the maturity date to give borrowers time to respond. Some lenders send it several weeks ahead, and others post the details through online banking. If your maturity date is approaching and no notice has arrived, contact your lender directly and confirm the terms in writing.
Can I negotiate the interest rate on a renewal notice?
Often yes. The rate printed on a renewal notice is the lender's first offer, and many lenders will adjust it if you ask or present a competing quote. Negotiating is simplest before the maturity date, while you still have the option of moving to another lender without triggering a mid-term prepayment penalty.
Sources
Related terms
- Mortgage Renewal — The point at which a mortgage term ends and the borrower negotiates a new term, rate, and conditions with a lender.
- Maturity Date — The maturity date is the day your mortgage term ends, when the remaining balance must be renewed, refinanced, or repaid in full.
- Mortgage Switch — A mortgage switch moves your existing mortgage to a new lender at renewal while keeping the same balance, amortization, and payment structure.
- Mortgage Term — A mortgage term is the length of your current contract with a lender, during which your rate and conditions stay in force — always shorter than the amortization period.
- Blend and Extend — Combining your existing mortgage rate with a current market rate to extend your term early, usually before maturity and often with a penalty.