Renewing a commercial mortgage: when and how

What renewing means

At the end of the term, the loan comes due. You must repay the balance, renew it or move it to another lender.

The term is not the amortization. BDC explains that the term is the period the contract is in effect, and that the rate is tied to it. Fixed rates generally run from one to ten years.

BDC also writes that a commercial mortgage is usually repaid over 20 years or less. The balance left at maturity must therefore be renewed or replaced.

Commercial contracts vary a great deal. This guide relies on the rules published for mortgages. Your contract comes first.

When to start

FCAC recommends comparing a few months before the term ends. Do not wait for your lender’s renewal letter.

New lenders need time. They appraise the property, review your financial statements and process the deeds.

• Six months before: reread the contract and find the maturity date
• Four months before: ask for your lender’s terms in writing
• Three months before: get offers from other lenders
• One month before: choose, and have the documents reviewed

These steps are a guide, not an obligation. A simple application will move faster than a complex one.

FCAC states that a federally regulated lender, such as a bank, must provide a renewal statement at least 21 days before the term ends.

That statement gives the balance, the rate, the payment frequency, the term and the applicable fees. The lender must also warn you 21 days ahead if it will not renew.

These rules describe consumer credit. A lender that is not federally regulated may follow other rules. Ask your lender what applies to your loan.

A call loan does not follow this calendar. BDC notes that the lender can demand repayment at any time.

Renewing with the same lender or switching

Nothing forces you to renew with your current lender. FCAC reminds borrowers that they can move the loan if another lender’s conditions suit them better.

Switching at maturity avoids the prepayment penalty. Switching before the term ends may trigger one.

• The new lender must approve your application under its own criteria
• It may require a new appraisal
• It may ask for new security

Plan for switching costs. FCAC lists setup, discharge, registration and transfer or assignment fees, plus an appraisal fee. Ask the new lender to cover part of them.

If one charge also secures other debts, FCAC warns that you generally must repay or transfer all of them. Confirm the type of charge with your notary.

Comparing two offers goes beyond the rate. FCAC suggests setting the rate, the switching costs and any insurance premiums side by side.

• The rate, and any discount you can negotiate
• The total cost of switching
• Payment frequency and prepayment privileges
• The term offered and its closed period
• The security and guarantees requested

If you hold a competing offer, show it to your current lender. FCAC notes that you may need to prove it.

Renewing before maturity

FCAC describes the blend-and-extend. The lender extends your term before it ends, and blends the old rate with the new one.

It is generally done without a prepayment penalty, though administrative fees may apply. Ask how the blended rate is calculated.

In FCAC’s example, 24 months at 5.5% and a new rate of 4% give 4.6%. That is an illustration, not an offered rate.

If you switch lenders before maturity, the penalty applies. The guide on prepayment penalties explains how it is calculated.

Ask about the charge that secures your loan too. FCAC warns that a collateral charge can bring extra fees when you switch.

In that case, every loan it secures generally has to be repaid or transferred. That could include a credit line or another business loan.

Allow a few months to settle this with your notary. FCAC also advises confirming the type of charge with your lender, lawyer or notary.

If the lender refuses to renew

A refusal may come from the property, the income, the financial statements or the lender’s policy. The application may have changed since the last term.

In that case, lead time becomes valuable. A refusal known four months ahead leaves time to find another lender.

Prepare the same documents as for a new loan: leases, income and expenses, the condition of the property. The guide on documents for a commercial purchase lists them.

Keep a simple timeline in the loan application. It prevents surprises.

• The maturity date and the notice period set in the contract
• Prepayment privileges and how you have used them
• Offers received, with their date and how long they stay valid

Review that application each year, not only at maturity. A loan you track is a loan you can plan to renew.

If your finances have changed since the last term, update your financial statements first. A lender reads the current picture, not the picture from the last signing.

What to do next

Find the maturity date of each loan in your portfolio. Note it four to six months ahead.

Gather your documents, ask your lender for its terms in writing and get at least one other offer.

PMECAP is a free comparison site and does not lend. For a refinancing, the request form goes to a mortgage brokerage registered with the AMF. The refinancing guide details the process.

FAQ

Sources

• ACFC : renouveler son prêt hypothécaire (accessed October 13, 2026)
• ACFC : rompre son contrat hypothécaire (prolongation avec taux mélangé) (accessed October 13, 2026)
• ACFC : pénalités de remboursement anticipé (accessed October 13, 2026)
• BDC : prêt hypothécaire commercial (glossaire) (accessed October 13, 2026)