The 8 Traps to Avoid at Renewal

Renewal is a major opportunity. Don't waste it with these common mistakes.

• 1. Signing the bank's offer without comparing (the most costly mistake)
• 2. Comparing only rates without prepayment and portability conditions
• 3. Ignoring the new lender's IRD calculation method (posted vs contractual rate)
• 4. Forgetting to check prepayment privileges (10% vs 15-20%)
• 5. Not asking for cash-back (0.5-1% of balance is common)
• 6. Waiting until the last minute to shop (start 4-6 months ahead)
• 7. Ignoring portability if a move is possible within the term
• 8. Choosing a term unsuited to your life plans

Each of these traps can cost hundreds to thousands of dollars over the term.

Renewal in the Quebec Context

Mortgage renewal in Quebec represents a major financial opportunity that too many homeowners underutilize. Approximately 60% of borrowers accept their bank's renewal offer without comparing, paying on average $2,500 to $7,500 more in interest per 5-year term. In Quebec, major banks (RBC, TD, BMO, Scotia, NBC, CIBC) and Desjardins credit unions generally send a renewal offer 21 to 30 days before maturity, a timeline often insufficient for adequate shopping. This is why experts recommend starting the process 4 to 6 months before maturity. Most lenders offer a 90 to 120 day rate hold, allowing you to lock in an advantageous rate while continuing to compare available market offers.

Maximizing Your Renewal: A Proven Strategy

To get the most from your renewal, adopt a strategic and methodical approach. Start by checking your credit score with Equifax and TransUnion six months before maturity. A score of 680 and above gives you access to the best rates at A-lenders. Correct any errors and pay credit card balances below 30% of the limit to optimize your score. Contact an AMF-certified broker four months before maturity to get the best market offers and a 120-day rate hold. Compare at least 3 to 5 detailed offers analyzing not only the rate but also prepayment conditions, portability, IRD calculation, conversion options, and cash-back incentives.

Protecting Your Interests at Renewal

Renewal is your mortgage freedom moment: no penalty applies and you can transfer free of charge to a better lender. Do not let inertia cost you thousands of dollars. In Quebec, an AMF-certified broker is your best ally in this process: they have access to preferred rates from multiple lenders, their service is free for borrowers, and the LDPSF requires them to act in your best interest. Take the time to compare, negotiate, and verify every clause before signing your next mortgage contract.