What’s the difference between refinancing and renewing a mortgage?
Updated: February 28, 2026CanadaFAQPrivate lending
Quick Summary
Renewal is choosing a new term at the end of your existing term; refinancing is changing the mortgage mid-term (often to access equity, change terms, or switch lenders).
Renewal is typically simpler. Refinancing can be more powerful, but it can also be more expensive.
Renewal (at maturity)
- You select a new term and rate.
- You may be able to negotiate or switch lenders.
- Usually fewer surprises if you plan ahead.
Refinance (before maturity)
- You may increase the mortgage to access Equity (cash-out).
- You can change the structure (rate type, Amortization, lender).
- You may face break penalties and additional Closing Costs.
How to decide
If your term is ending soon, start with renewal planning. If you need funds or a structural change now, refinance may make sense—but only after you compare total costs (penalty + fees + new rate).