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Refinancing, Transfer Mortgage, and Mortgage Renewal in Canada:
1. Mortgage Refinancing
Refinancing means replacing your current mortgage with a new one, usually to access better terms or borrow additional funds.
When to Refinance:
To get a lower interest rate
To access home equity (borrow more money)
To consolidate high-interest debt (credit cards, loans)
Key Points:
It may involve penalties if done before the term ends
You can refinance up to 80% of your home’s value
Requires a new mortgage approval process
2. Mortgage Transfer (Porting or Switching)
A mortgage transfer means moving your mortgage from one lender to another, usually to get a lower rate or better terms, without changing the loan amount.
When to Transfer:
If another lender offers a better interest rate
If you want better mortgage features (prepayment options, flexibility)
If your current lender isn’t offering good renewal terms
Key Points:
No changes to loan amount or amortization
Requires a new mortgage approval
3. Mortgage Renewal
Renewing a mortgage means signing a new contract with your current lender when your term ends.
When to Renew:
If you want to continue with the same lender (but negotiate better terms)
If your mortgage term (e.g., 5 years) has ended and you still have a balance to pay
Key Points:
No penalties, as it happens at the end of your term
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