Mortgage Renewal in Alberta: What to Do When Your Term Ends

Your mortgage term is ending, and your lender just mailed you a renewal letter with a single rate on it. Signing it is the easiest thing to do and almost always the most expensive. This guide shows you how to read your renewal, decide whether to renew or switch, and use a 2024 rule change that now makes shopping around far easier across Canada.

What a Mortgage Renewal Actually Is

A renewal happens at the end of your mortgage term, when your contract with the lender expires but you still owe a balance. You negotiate a new rate and a new term on the remaining principal. You do not get new money, and you do not extend your amortization.

That is the key difference from a refinance. According to the Financial Consumer Agency of Canada (FCAC), a refinance replaces your mortgage with a new one and can increase the principal or lengthen the amortization. A refinance can happen any time. A renewal only happens at term end, and it keeps your loan amount the same.

Why does this matter? Because renewing is simpler and triggers fewer hurdles than refinancing. If all you want is a better rate at term end, you are renewing, not refinancing.

You Have More Power Than the Letter Suggests

Federally regulated lenders must send you a renewal statement at least 21 days before your term ends. That same 21-day notice applies if the lender decides not to renew your mortgage at all. So you should never be surprised.

The rate printed on that letter is a starting point, not a final offer. Lenders count on busy people signing the easy option. The renewal window is your one no-penalty chance to move your mortgage, so treat it like a negotiation.

The 2024 Rule That Made Switching Easier

For years, switching lenders at renewal meant re-qualifying under the mortgage stress test, even though you were not borrowing a dollar more. That penalized people for shopping around. It changed in late 2024.

Effective November 21, 2024, the Office of the Superintendent of Financial Institutions (OSFI) stopped prescribing the Minimum Qualifying Rate, the stress test, for uninsured "straight switches." A straight switch means moving your existing standalone uninsured mortgage from one federally regulated lender to another with no increase in amortization and no increase in the loan amount. The balance can rise by up to $3,000 to cover transaction costs, but you cannot take out equity. The federal government extended the same relief to insured straight switches effective December 16, 2024.

This is a real change in your favour. You can now move to a cheaper lender at renewal without proving you qualify at a rate roughly 2% above your contract rate.

Renew, Switch, or Stay Put: A Worked Example

Say you bought an Edmonton home a few years ago. Edmonton residential homes have a current median sold price of roughly $472,527 based on recent MLS data, and they sell at about 98.4% of list price with a median of 29 Days on hômm. That is a stable market, not an inflated one, which means your equity is real but you are not sitting on a windfall.

Now your term ends. Your lender offers you 4.79%. You phone two competitors and one offers 4.34% on a straight switch. On a $400,000 balance over a 25-year amortization, that 0.45% gap is worth several thousand dollars across a five-year term. Because it qualifies as a straight switch, you skip the stress test entirely.

To run your own numbers, use our free mortgage renewal calculator to compare your current payment against a new rate before you sign anything. It takes two minutes and shows you exactly what each offer costs. You can also model different amortizations with our mortgage payment calculator.

If the math says staying in your home is tight, it helps to know what re-entering the market would cost. Here is what is selling in Edmonton right now.

For most people, keeping the home and renewing at the best available rate beats selling and rebuying, because selling costs you commissions and closing costs while buying restarts the clock. Curious what your place is worth before you decide? Get a free, no-obligation home value estimate.

Why This Renewal Cycle Is Different

This is not a normal renewal season. The Bank of Canada reports that about 60% of all outstanding Canadian mortgages renew in 2025 or 2026, and most of those borrowers will see their payment go up.

The pain is not evenly spread. People who took five-year fixed mortgages, about 40% of all Canadian mortgages, face the largest jump: average payment increases of roughly 15% to 20% when they renew in 2025 or 2026. That is because many locked in when the Bank of Canada policy rate sat at or below 1%. Borrowers renewing in 2026 specifically face a smaller average increase of about 6% compared with late 2024 levels. As of its June 4, 2025 announcement, the policy rate was 2.75%.

Alberta feels this too. CMHC pegged Edmonton's mortgage delinquency rate at 0.291% in the third quarter of 2025, higher than Calgary's 0.164%, though CMHC expects Edmonton's rate to hold steady rather than spike through 2026. The lesson is simple: do not assume your renewal payment is fine until you have actually calculated it.

A Five-Step Renewal Plan

Work this list in the four months before your term ends:

1. Calculate your new payment at today's rates before you do anything else, so a higher number does not catch you off guard.
2. Get your current lender's renewal offer in writing, then ask them to beat it.
3. Get at least two competing quotes, and ask specifically about a straight switch so you keep the stress test off the table.
4. Decide renew versus refinance. Only refinance if you need to change the loan amount or amortization, and remember that reopens the stress test.
5. If you are even considering selling instead, check your equity first with a current home valuation.

If your bigger question is whether you can still afford the home at all, our guide on how much house you can afford in Edmonton walks through the income and debt math.

Frequently Asked Questions

Do I have to pass the mortgage stress test to switch lenders at renewal?

Not if it is an uninsured straight switch. Since November 21, 2024, OSFI no longer prescribes the Minimum Qualifying Rate for moving an existing standalone uninsured mortgage to another federally regulated lender, as long as the amortization does not lengthen and the loan amount does not rise (the balance may increase by up to $3,000 for costs). Insured straight switches got the same relief on December 16, 2024. The lender still does its own underwriting, and the full stress test returns if you refinance.

How much notice does my lender have to give me before my term ends?

Federally regulated lenders must send a renewal statement at least 21 days before your current term ends. That same 21-day minimum applies if the lender has decided not to renew your mortgage, so you have time to arrange financing elsewhere.

What is the difference between renewing and refinancing?

Renewing renegotiates your rate and term on the existing balance at the end of your term, with no increase in principal. Refinancing replaces your mortgage with a new one and can raise the loan amount or extend the amortization, and it can be done any time. Refinancing reopens the full stress test; a straight-switch renewal does not.

Will my payment go up when I renew in 2026?

It depends on your original rate, but for many people yes. The Bank of Canada expects most borrowers renewing in 2025 or 2026 to see higher payments, with 2026 renewers facing average increases around 6% and five-year fixed borrowers facing roughly 15% to 20%. Run your specific numbers through a renewal calculator rather than guessing.

Can I break my mortgage early to get a lower rate before renewal?

You can, but a closed mortgage usually charges a prepayment penalty. On a fixed-rate mortgage that penalty is the greater of three months' interest or the Interest Rate Differential, so you pay whichever is higher, not whichever is cheaper. That penalty can erase your savings. The pillar guide on breaking a mortgage penalty in Canada explains how to run that math before you decide.