Calculator
Stay or switch at renewal?
A lower rate elsewhere is only worth taking if it covers the cost of moving. Enter your renewal offer, the competing rate and what switching would cost you, and see who comes out ahead over the term.
Result over the 5-year term
Switching comes out $4,118 ahead
Interest saved by switching $5,618 minus costs $1,500.
Payment if you stay
$2,562
Payment if you switch
$2,498
Break-even
17 months
months of savings to cover costs
Fixed rates, semi-annual compounding, same amortization either way. Ignores any new default-insurance premium (which can apply if the loan or amortization increases) and the value of different mortgage features.
How it works
- Both options use the same balance, remaining amortization and term, with semi-annual compounding.
- Interest saved is the difference in interest paid over the term.
- Break-even is how many months of that saving it takes to cover the switching costs.
Questions people ask
What costs should I include?
FCAC lists discharge, registration, transfer or assignment fees, an appraisal and administration fees. Subtract anything the new lender agrees to cover.
Is there a prepayment penalty at renewal?
Switching at the end of your term normally avoids a prepayment penalty. Switching before maturity can trigger one; use the penalty estimator.
Could a new insurance premium apply?
FCAC notes a new mortgage loan insurance premium may apply if the loan amount increases or the amortization is extended.