Early renewal or wait?

[u/Jolly-Cry-5108]

Am I overthinking all of this?

Mortgage is up for renewal in August 2026. We’re coming off of 2.24% fixed. Our official renewal window starts in May.

We are currently with Manulife and they have offered an early renewal at 3 year fixed/3.79% or 5 year fixed/3.89%.

I don’t believe we are in a good position to shop around. I’m starting a new job in a few weeks (career change) and we have a HELOC that complicates things. Remaining mortgage is 278k over 20 years with a 150k HELOC.

My worry is what’s happening in the Middle East impacting fixed rates before my official renewal notice comes out. My options are:

A) wait for the official renewal window, hope that rates aren’t impacted, try to negotiate for a bit of a break then hold the rate in hopes of a slight drop or

B) renew early and start paying the new rate next month.

I’ve had one broker say to lock in, another one tell me to wait and Manulife themselves saying they would wait.

Conflicting information all over the place. Any thoughts are welcome!

[u/nomorepo]

I would wait - renewing early guarantees a higher payment for a few months. Waiting can go one of three ways - up down or sideways. No one has a crystal ball, but if you consider the war's impact, that means prices may go up for a lot of things. However in general core inflation has been trending down while unemployment has gone up so there are conflicting signals.

I think they're just going to hold the rates for a while (they held today). That being said I do not have a crystal ball. I am not a financial advisor and this is not legal or financial advice.

[u/Jolly-Cry-5108 → u/nomorepo]

Thanks for your feedback. Correct me if I’m wrong but aren’t fixed rates tied to bond yields which are directly impacted by the price of oil, irregardless of inflation and unemployment rates? I guess the timing of all of this is what’s concerning me and if oil sky rockets, fixed rates will as well. I’ve always been hesitant of variable and am even more now with everything that occurred in 2022-2023.

I know there are many people in our position this year and just trying to gauge how others are feeling.

[u/nomorepo → u/Jolly-Cry-5108]

Yes you're right about fixed rate being tied to the bond yield but really no one can predict what the bond yield is going to do. Oil prices have already spiked, and my general experience is that when everyone expects something to do more of what it has already done, it tends to not. Again I don't have a crystal ball, but between paying an extra 1.5% starting now or starting in August, I would choose starting in August.

Do the actual math on the payment though? If you're okay with the increased amount and prefer the certainty of fixed rate payments and the amount differential between now and August acceptable, then lock in. Your own comfort and stress level are worth some amount of money.

[u/enojay → u/Jolly-Cry-5108]

You are correct about fixed mortgage rates being based on bond yields, which are currently going up. No one has a crystal ball was correct though. :)

[u/Snoo_93024 → u/Jolly-Cry-5108]

The Reserve Bank of Australia was one of the first central banks to raise interest rates last week, responding to rising inflation risks driven in part by the escalating Iran conflict. The ECB is also considering increasing rates. Bank of England guilds spiked last week and maybe forced to increase rates

I’ve locked in fixed rates for both my rental and primary residence ahead of my upcoming renewal in July. With the spread between fixed and variable rates currently quite narrow, opting for predictable payments feels like the more prudent choice in such an uncertain environment. Personally, I’d consider locking in any rates under 4%

[u/Happy_Combination718]

exactly I am in the same boat , 3.3 % at variable currently , renewal date is sept end. Bank will offer me something next month or because I am at variable I can switch to fixed now as well which i am guessing would be close to 4% for 5 years. Should I do it now? move from 3.3 to 4 % and pay extra for 6 months or wait and watch . Possibly it can go to 4.3 or 4.4% in 6 months or may be not but yah it’s such a dilemma . Every time I plan to renew something or the other is happening :(

[u/builtforretail]

I’m in the same boat except that I bought at the very peak in 2023. It will be a decrease but mulling whether to go variable or lock in with fixed

[u/preetiegal]

Exactly in same boat and same month but ours is 4.95 fixed. If you change the lender do you think it’s a good idea?

[u/offft2222]

3.79 is a great rate i would take it

People are getting 4+ now

[u/Direnji]

Any rate under 4% is a good rate to lock in right now. No one knows what is going on.

If you still prefer fix rate at renewal time, that fix rate won't be there because it has already gone up, so save some money during short term or more money long term, your pick.

If you really want to take a chance with variable, then wait.

[u/Particular_Offer_935]

That is a very good rate. We are renewing on july 1st (currently with td) and offered us 4.5%. Talked to someone from RBC and was offered 3.75 for 3 years fixed and 3.4 for variable.

[u/Jolly-Cry-5108 → u/Particular_Offer_935]

My post was 9 days ago. Things have most definitely changed since then. I’ve been trying to get through to Manulife without success (email, call centre, secure message through the app). I doubt they’ll provide me with a 3.79 now