Mortgage renewal tips
Don’t put your mortgage renewal on autopilot. Learn how to get the most out of your next mortgage term. We’ll show you how to save on interest, how to pay down your loan faster and how to use BMO’s flexible payment options as a safety net.
What is a mortgage renewal?
Mortgage renewal is the continuation of your mortgage loan from one term to the next. Renewing allows you to adjust important aspects of your mortgage such as payment size, payment frequency and term length. It also allows you to make lump sum payments that can reduce your balanced owed. Mortgage payments often change at renewal, making it important to plan your renewal alongside your other financial goals.
Preparing for a mortgage renewal
Reflect on your financial goals.
See how a mortgage renewal might affect your finances and your future goals:
- Speak with other mortgage holders to highlight what has changed since your term began.
- Consider high-interest debt that needs to be paid off.
- Factor in plans to move before selecting a renewal term.
Plan for big expenses down the road.
Remember to account for big expenses in the future. Renovations, a new vehicle, childcare or even a well-earned vacation should be factors in your mortgage renewal.
Review your current mortgage details.
Brush up on your existing mortgage to understand how it affects your financial goals.
- Mortgage payment: the amount owed, covering both the principal amount and interest.
- Payment frequency: how often you pay (e.g. monthly, semi-monthly or bi-weekly).
- Amortization: the number of years it will take to pay off your mortgage.
- Term: the length of time you’re committed to a lender and a rate (usually up to five years).
Preview your payments at renewal.
Get a tangible sense of your mortgage payments upon renewal with our mortgage renewal calculator. Explore your options to understand how your renewal options affect your mortgage payment.
Tailor your mortgage to suit your needs
Save interest with a lump sum or increased payment size.
Lump sum payments go directly to your principal amount, and most mortgages allow you to pay down a certain amount per year. You can also increase your payment amount by up to 20%1 once per year. Use the mortgage renewal calculator to find potential savings.
Think about adjusting your payment frequency.
Shifting to weekly or bi-weekly payments can reduce the length of your mortgage. Alternatively, switching to monthly payments could help with cash flow. You can change this at any point, not just at renewal.
Consider adjusting your amortization period.
If you're ahead of your amortization schedule, then you can decrease your mortgage payment by extending your amortization period. A longer amortization period also means paying more interest over the lifetime of your mortgage. Alternatively, you can increase your mortgage payment to shorten your amortization period. This reduces total interest paid in the long run.
Think about your ideal term length.
Term lengths typically range from several months to five years. Long terms tend to offer more stability, while short terms may be helpful if your financial plans are likely to change in the future.
What to expect during renewal
We’ll contact you.
We’ll get in touch to notify you about the renewal process. One of our mortgage experts will also call you closer to your maturity date if we don’t hear back from you.
View your personalized renewal rate.
View your personalized renewal rate 180 days before renewal in the BMO App or Online Banking, if you're eligible. You can also call us directly.
Knowlegeable mortgage experts.
Prepare for your renewal with mortgage experts who take the time to understand your finances today and your plans for tomorrow.
Why you should renew with BMO
Prepay your way
You can lower your mortgage payment or pay off your mortgage faster by making a lump sum prepayment at the end of your term.
Skip the application
If you have a mortgage with BMO then we already know you. This lets you renew without going through another application2, saving you time and paperwork.
Complete in minutes
Check this off your list before dinner. Simply log into the BMO app or Online Banking to renew your mortgage quickly.
Have a safety net with BMO's flexible payment options
Take a Break® Option*If money is tight then you can skip up to one month of mortgage payments per calendar year. Some restrictions apply. Talk to us for details.
- Family Care® Option*
Skip up to four months of mortgage payments (principal and interest) once per year if you or your partner must leave your job to care for a new baby or a sick family member.
Mortgage renewal calculator
Get a quick estimate of your mortgage payment at renewal. See how prepayment options can create long-term savings, too.
Ways to renew your mortgage
You can renew with BMO as early as 180 days before the end of your term. When you’re ready, get in touch with us the way you prefer.
Online
Renew your mortgage in minutes by signing into BMO Online Banking.
By phone
Call us on your schedule to speak directly with a mortgage expert.
In person
Explore your renewal options with a mortgage expert at your local BMO branch.
Frequently Asked Questions
If you take no action, then your mortgage will be renewed automatically. Please check your lending agreement for more details.
However, actively renewing your mortgage with BMO lets you explore different payment options to support your financial goals.
No. If you have a mortgage with BMO2 then we already know you. You’d only need to prepare documentation if you made applied for a new and separate mortgage.
There is no fee to renew most mortgages. However, refinancing could incur fees because it would involve a new application for a new mortgage loan.
Mortgage renewal lets you continue your current mortgage with new rates and adjustments to your payment options. Mortgage refinancing turns your old mortgage into a new and separate one, complete with a new loan amount and a new amortization period (its duration).
Keep in mind that refinancing requires a new application, even with your existing lender.
The maturity date is the last day of your current mortgage term.
No, the letter only contains standard rates and possible options for your renewal. You will receive this if we haven’t received your renewal instructions yet.
Please call us at 1-877-594-0082 to review your personalized mortgage rates and renewal options with a mortgage expert.
Helpful resources
Understanding the impact of rising interest rates
With interest rates on the rise in Canada, learn how you can navigate through this with your variable rate mortgage.
Fixed vs. variable rate mortgages: pros and cons of each
Mortgages aren’t one-size-fits-all. Here’s what you need to know to pick the one that’s right for you.
Pay your mortgage faster
Learn how to pay down your mortgage faster with these tips. We’ll explain the payment options that’ll help you do it.
1. Accelerated payment details vary for a BMO Smart Fixed Mortgage, please consult your lending agreement(s) or contact a BMO representative.
2. Subject to meeting BMO’s standard lending criteria. Please contact a BMO representative.
* Take a Break or Family Care Options are not available for a BMO Smart Fixed Mortgage. Take a Break and Family Care options apply to principal and interest payments on conventional and default-insured mortgages for owner-occupied single-family dwellings only, including condominiums and duplexes.
For conventional uninsured mortgages, the balance of your current mortgage plus the skipped payment must not exceed 80% of the lesser of a) your home's present value or b) the original amount of your mortgage with us.
For mortgages insured against default, customers must have prepaid principal at least equal to the amount of payment(s) to be skipped. Any mortgage insurance premiums and tax payments cannot be skipped. Interest for the skipped payment is added to the principal. The balance of your current mortgage plus the skipped payment must not exceed the original amount of your mortgage with us.
Your current mortgage must not be more than one month in arrears at the time of the requested skip. Any payment(s) in arrears will be included in those to be skipped.
The Family Care option is not available to self-employed individuals. Borrowers currently receiving Mortgage Disability benefits (provided by Sun Life Assurance Company of Canada) are not eligible for skipped payments.