Mortgage Renewal Calculator
This calculator takes the balance you will renew, the years left to pay, the rate you pay now, your renewal letter rate and a shopped rate, then shows the payment at each. With the illustrative defaults, a $400,000 balance renewing from 1.89% to the 4.79% BMO letter rate rises $581.97 a month, and a 4.44% shopped rate is $74.40 a month lower than the letter.
What Each Input Means
Balance at renewal is the principal still owing on the day the new term starts, not the original loan. It is on your latest mortgage statement, and the renewal letter usually repeats it. Years left to pay is the remaining amortization, which is different from the term. A mortgage can have a 3-year term left and 20 years of amortization left, and it is the 20 that drives the payment.
New term is how many years the next rate is fixed or priced for. It only affects the last output, because the interest total is counted across that term and no further. Rate you pay now is your current contract rate. Renewal letter rate is what your lender has offered. Shopped rate is any other written quote on the same balance and status, from another lender or through a broker.
One honest caveat on the first output. The payment now is not read from your statement. The calculator recomputes it on the remaining balance and years left at your current rate, so it is an approximation of your real payment. If your original amortization was longer, if you made prepayments, or if you have a fixed-payment variable mortgage, your actual payment can differ. Use the number on your statement for the real comparison and treat the calculator's figure as a close estimate.
The Formula Behind The Payments
Canadian fixed mortgages compound semi-annually. The monthly rate is i = (1 + r/2)^(1/6) - 1, where r is the annual rate as a decimal, and the payment is P x i x (1 + i)^n / ((1 + i)^n - 1), with n the number of monthly payments. The mortgage payment formula guide walks through it, and variable mortgages are often computed the same way. The interest total comes from a month-by-month simulation: each month, interest is the balance times i, the rest of the payment reduces the balance.
Worked Example With The Defaults
The defaults are illustrative. They describe a borrower who locked in at 1.89% in a low-rate period and is renewing into a very different market. The letter rate is the BMO five-year insured fixed row of 4.79% from a public renewal thread. The shopped rate is 4.44%, the figure reported as available at BMO and offered by RBC for a three-year fixed on October 28, and also the lowest advertised three-year rate. Those two come from different terms, so treat the pairing as an illustration of a gap rather than a like-for-like quote.
| Item | Rate | Monthly payment | Interest over 36 months |
|---|---|---|---|
| Payment now, recomputed on $400,000 over 20 years | 1.89% | $2,001.37 | $21,208.90 |
| Letter rate | 4.79% | $2,583.34 | $54,303.17 |
| Shopped rate | 4.44% | $2,508.94 | $50,282.82 |
The jump at renewal is $2,583.34 minus $2,001.37, or $581.97 a month. The gap between letter and shopped is $74.40 a month. Over the three-year term, the letter rate costs $4,020.35 more in interest than the shopped rate ($54,303.17 minus $50,282.82). That is more than the payment gap times 36 months, which is $2,678.40, because the interest total includes how the balance falls differently under each rate. After 36 payments the balance at the letter rate is about $361,303 and at the shopped rate about $359,961.
The calculator's last output labels that figure as extra interest at the letter rate, meaning the difference against the shopped rate over the term you entered.
A Second Example With A Larger Balance
These inputs are illustrative, not quotes: a $600,000 balance, 25 years left, a five-year term, a current rate of 2.19%, a letter at 4.84% (the figure BMO and CIBC were advertising for a five-year fixed around October 28) and a shopped rate of 4.44%. The payment now is $2,596.05. At the letter rate it is $3,435.18, a jump of $839.13 a month. At the shopped rate it is $3,300.85, which is $134.33 a month less than the letter. Over the 60-month term the letter costs $135,811.01 in interest and the shopped rate $124,304.92, so the extra interest at the letter rate is $11,506.09.
The larger the balance and the longer the term, the more a small gap is worth. A 0.35 point difference on $400,000 over three years is about $4,000. A 0.40 point difference on $600,000 over five years is nearly three times that. This is the reason the gap line is worth reading before the jump line. The jump is mostly the market, and you cannot negotiate it. The gap is the part a quote can change.
How To Use The Output Lines
Read the lines in this order. The monthly jump tells you whether the household budget can carry the renewal at all, and if the answer is uncomfortable, that is the moment to look at amortization, term and prepayment options with a lender rather than after signing. The monthly gap tells you what a written competing quote is worth each month. The extra interest line turns that gap into a total over the term, which is the number to weigh against any fee for switching, such as appraisal, legal work or a discharge charge from your current lender.
Change one input at a time. Try the shopped rate at 4.34%, the figure reported for a three-year fixed through a broker on a B2B rate sheet dated October 21. Try the term at 5 years and 1 year. Try the years left at 25 or 30 to see how a longer amortization lowers the payment while adding interest. Insured mortgages can have up to a 30-year amortization for first-time buyers and new builds, but at renewal your remaining years usually carry over, and extending them can turn a straight switch into a file that is stress-tested again.
Why Renewals Are Landing Higher
The Bank of Canada put numbers on the wave. In a July 2025 staff note, it estimated that about 60% of outstanding mortgages renew in 2025 or 2026, with an average payment about 10% higher for 2025 renewers and about 6% for 2026, compared with December 2024. For five-year fixed mortgages, the average rise was 15% to 20%. The May 2026 Financial Stability Report added that the last cohort of pandemic-era five-year fixed-payment mortgages, about 12% of outstanding, renews over the 12 months to mid-2027 with payment increases of about 15% on average. Another 14% renewing in the same window expect no payment change on average.
These figures predate the October 28, 2026 rate hike, so they understate what a variable or newly shopped borrower faces today.
What This Calculator Ignores
It does not know your insured status, which changes the rates you can get. It ignores fees such as appraisal, legal and discharge costs, cash-back offers, and the cost of any prepayment you make. It assumes the amortization stays the same, so it will not show what happens if you extend. For a variable rate, it treats the entered rate as fixed for the term, but prime moved from 4.45% to 4.70% on October 29 and may move again. It also does not apply a stress test, and a straight switch with no more borrowing does not need one at a federally regulated lender under the OSFI rule from November 21, 2024. The mortgage renewal rates page covers that switch path.
Take The Result To A Broker
Keep the output with you when you call anyone. A lender hearing "my payment goes up $582 a month" has a different conversation than one hearing "I would like a better rate."
Once the gap is a number, the next step is to see whether a lender will write it. Request cheaper rates and ask a licensed mortgage broker to price your exact balance and amortization at a three-year and five-year fixed, then compare both to the letter you entered. If the monthly gap is larger than a few dollars, it is worth the call before the lender's 21-day renewal statement deadline.
Questions
Is the payment now figure my real payment?
No. The calculator recomputes it on your remaining balance and years left at your current rate, so it approximates the payment. Your statement shows the real one, and it can differ because of prepayments, a longer original amortization or a fixed-payment variable contract.
Why does the interest difference exceed the payment gap times months?
Because a higher rate means more of each payment goes to interest and less to principal. The interest total is simulated month by month, so it captures the slower balance decline under the higher rate.
What compounding does this calculator use?
Canadian semi-annual compounding, the standard for fixed mortgages: monthly rate i equals (1 + r/2) to the power 1/6, minus 1. The result matches the figures in the payment formula guide.
How much will my payment rise at renewal?
It depends on your old rate, balance and years left. On $400,000 over 20 years, moving from 1.89% to 4.79% adds $581.97 a month. Enter your own numbers above for your case.