Your Mortgage Is Renewing in 2026. Here's What I'd Look at Before Signing.
I've had several conversations with homeowners lately that have started with the same thing: a mortgage renewal.
A lot of people locked into incredibly low rates back in 2021. Now those five-year terms are coming up for renewal, and some homeowners are looking at a noticeably higher monthly payment than what they've been used to.
And naturally, the question becomes:
Is this normal, and what should I do about it?
The first answer is yes. If you locked in around the historically low rates we saw in 2021, renewing at today's rates is likely going to look different.
But the second answer is a little more important:
Before you automatically sign another mortgage term, run the numbers.
There is some reassuring context here. The Bank of Canada has already brought its policy rate down considerably from its peak and, as of September 2026, is holding it at 2.25%. So homeowners renewing today aren't necessarily dealing with the highest-rate environment we've seen over the last few years.
The challenge is that many people renewing in 2026 are coming from the exceptionally low rates available in 2021, and that's what makes the difference feel so significant.
What Could Your New Mortgage Payment Look Like?
This is where I think actual numbers are much more helpful than talking about percentages.
Let's use a simple example.
If you had a $400,000 mortgage at 2.10% with a 25-year amortization, your payment would be approximately $1,713 per month.
At 4.04%, that same $400,000 mortgage over 25 years would be approximately $2,113 per month.
That's a difference of roughly:
$400 per month
$4,800 per year
On a $500,000 mortgage, the difference becomes even more noticeable.
At 2.10%, the payment would be approximately $2,141 per month.
At 4.04%, it would be approximately $2,641 per month.
That's approximately:
$500 more per month
$6,000 more per year
These are simplified examples using the same mortgage balance and a 25-year amortization to show the impact of the rate change. Your actual renewal payment will depend on your remaining mortgage balance, remaining amortization, the rate you're offered and the specific terms of your mortgage.
But it gives you an idea of why some homeowners are opening their renewal letters and doing a bit of a double take.
An extra $400 or $500 per month might be completely manageable for one household.
For another, that's $4,800 to $6,000 every year that suddenly needs to come from somewhere else in the family budget.
The important thing isn't that every homeowner will experience the exact same increase.
They won't.
It's understanding what your new payment actually looks like before committing to it.
Why Are 2021 Renewals Feeling So Different?
The Bank of Canada's policy rate was just 0.25% through much of the pandemic before eventually climbing to 5% as the Bank worked to bring inflation under control.
Rates have since come down considerably, with the Bank of Canada holding its policy rate at 2.25% as of September 2026.
But that doesn't mean we're back to the exceptionally low borrowing environment of 2021.
That's why homeowners who locked into a five-year mortgage near the bottom are feeling such a noticeable difference now.
A Mortgage Renewal Isn't Just a Rate. It's a Decision Point.
This is the part I think homeowners sometimes overlook.
When that renewal letter arrives, it's easy to look at the new rate, calculate the payment and assume the only decision is whether to sign.
But you're potentially committing yourself to another mortgage term.
So before you do, I think it's worth asking a bigger question:
Does staying in this home, at this payment, still make sense for where I am today?
For many homeowners, the answer will absolutely be yes.
You love your home, the new payment fits comfortably within your budget, and renewing makes perfect sense.
But for others, especially homeowners who have built significant equity over the last five years, renewal can be a good time to step back and look at the bigger picture.
Maybe you've been thinking about downsizing.
Maybe your kids have moved out.
Maybe you want a different property.
Maybe you've been considering moving from Red Deer to Sylvan Lake — or the other way around.
Or maybe you're simply wondering whether carrying the same mortgage into another term still makes financial sense.
Depending on your equity position, moving to a less expensive property and carrying a smaller mortgage — or potentially no mortgage at all — could change your monthly housing costs considerably.
But you can't really compare those options until you know what your current home is worth.
Your Bank Gives You One Half of the Equation
Your lender can tell you:
- Your new interest rate
- Your mortgage balance
- Your new payment
- Your available mortgage options
But there's another important number:
Your equity.
If your home has increased in value since you purchased it, your financial position today may look very different than it did five years ago.
That's where a current market evaluation becomes useful.
Not because receiving a mortgage renewal means you should sell your house.
It doesn't.
But if you're already questioning whether you want to stay, understanding your home's current market value gives you the other half of the equation.
Then you can compare:
What does staying look like?
versus
What could moving look like?
And make the decision based on actual numbers rather than guessing.
The Bottom Line
If your mortgage is coming up for renewal in 2026, don't panic over the new payment.
But don't automatically sign without looking at the bigger picture either.
Find out what your new mortgage payment will actually be.
Find out what your home is currently worth.
Understand how much equity you have.
Then decide what makes the most sense for you and your family.
Sometimes the answer will be to renew and stay exactly where you are.
Sometimes it might be the right time to make a move.
Either way, I'd rather see homeowners make that decision with all of the numbers in front of them.
Frequently Asked Questions
How much will my mortgage payment increase when I renew in 2026?
There isn't one percentage that applies to everyone. Your increase depends on your current mortgage balance, existing rate, new rate, remaining amortization and mortgage terms.
As a simplified example, a $400,000 mortgage amortized over 25 years would be approximately $1,713 per month at 2.10% compared with approximately $2,113 at 4.04% — a difference of about $400 per month.
Your lender or mortgage broker can calculate your actual renewal payment based on your specific mortgage.
Should I sell before my mortgage renews or after?
There's no single answer.
If you're already considering moving, I would look at both options before signing a new mortgage term. Find out your mortgage payout information and have your home's current market value evaluated.
That allows you to compare the financial impact of staying versus selling while you still have options.
Does a mortgage renewal mean I should sell my home?
Absolutely not.
For many homeowners, renewing and staying will still make the most sense.
A renewal is simply a good opportunity to review your financial position, especially if you've already been considering downsizing, moving or making another change.
What if I have a variable-rate mortgage?
Variable-rate mortgages work differently from fixed-rate mortgages, and your experience will depend on your specific mortgage terms and lender.
If you're approaching renewal, speak with your lender or mortgage broker about your options and what your payment would look like under different scenarios.
Want to Know What Your Home Is Worth Before You Renew?
If your mortgage is coming up for renewal and you're wondering whether it makes more sense to stay or make a move, I'm happy to help you figure out the real estate side of the equation.
A home evaluation is completely free and there is absolutely no obligation to sell.
I'll show you what your home could realistically sell for in today's Central Alberta market so you can understand your equity position and make the decision that's right for you.
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Broker/Owner
Lime Green Realty® Central
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