Mortgage Refinancing in Quebec 2026: When and How to Do It

With the policy rate at 2.25% and 5-year fixed rates around 3.69%, 2026 is a pivotal year for evaluating refinancing. 60% of Canadian mortgages renewing in 2025–2026.

The 0.5% Rule: Break-Even Calculation

Example: $400K at 4.25% to 3.69% = $2,240/year saved = $11,200 over 5 years before penalties. Balance against estimated penalty of $4,000–$14,000.

How Penalties Are Calculated

For fixed-rate: greater of 3 months’ interest or IRD. Major banks often calculate IRD unfavorably. Compare with an independent mortgage broker.

When to Wait Rather Than Refinance

Within 18 months of term end: wait. If April 29 BoC might bring a cut: consider waiting. Rule: break-even = penalty / monthly savings = months to recover. If that exceeds your remaining term, wait.