on September 30, 2024 
As of November 21, 2024, mortgage borrowers with uninsured mortgages will be allowed to switch their mortgage from one lender to another without having to qualify using the stress test higher interest rate (determined as the higher of the Bank of Canada’s five-year benchmark rate or their mortgage rate plus 2%).
This change will make it easier for borrowers to move their mortgage to a new lender offering a lower rate, helping to keep mortgage lenders competitive and ensure borrowers are not “stuck” with their existing lender at renewal and forced to take whatever rate the lender offers.
However, it’s important to understand that this change will only apply in the case of a “straight switch”, where there are no changes made to the mortgage balance or amortization timeline. If a borrower needs to refinance for more money, or extend their amortization timeline to reduce their payment amounts, their new loan will be subject to qualifying based on the higher stress test rate.
Mortgage Professionals Canada (MPC), a national mortgage broker industry group, has long been fighting for this change to help borrowers, as the current rules combined with the drastic increase in rates over 2023/2024 have made it almost impossible for many mortgage holders to re-qualify under the stress test for the mortgages that they already have. When these borrowers reach their term maturity date and need to renew for another term, they have no option but to accept the rates offered by their existing lender. And knowing this, many lenders have been offering substantially higher renewal rates to these clients than the interest rates they offer to new clients.
What does it mean for me?
This is great news for all mortgage borrowers whose mortgages are coming up for renewal after November 21st. It will help to make lenders more competitive and allow mortgage brokers to more effectively help their clients obtain the best borrowing options for their next mortgage term.
If your mortgage is coming up for renewal in the next 6 months, please reach out to us now or book your free, no obligation mortgage renewal consultation. We’ll help you figure out you best options as your renewal date approaches and make sure you pick the best mortgage product for your next term to meet your personal and financial goals.
Have questions?
We are always happy to discuss your financing needs!
Please book an appointment today with one of our broker team to discuss your plans and we’ll make sure you have all the information you need to make the best financial decision and get the best mortgage to reach your goals.
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