When Rachel* opened her mortgage renewal letter, the plan was simple: sign it, send it back, and get on with life.
By Josh Tagg, mortgage broker · Mortgages for Less with INDI Mortgage · Calgary, serving all of Alberta
Her lender was offering 4.24% to renew for another five years. Nothing alarming — a perfectly ordinary rate on a perfectly ordinary letter, and like most homeowners at renewal time she was a signature away from just accepting it. But there was a second, heavier weight she’d been carrying alongside the mortgage: about $30,000 in credit-card debt at roughly 18% interest. The minimum payments came to around $900 a month — and with that much interest baked in, the balance barely moved. Before she signed the renewal, she reached out to us with a simple question: is this really the best I can do?
It wasn’t. Not even close.
The turning point: renewal is the moment to change everything
Most people treat the renewal letter like a utility bill — sign it and send it back. It’s the easy option, and lenders count on that. But at maturity your mortgage is penalty-free to move, and that is the one window where you can shop the rate and restructure your borrowing without paying to break anything.
Rachel didn’t know that. She thought her only choice was the 4.24% printed on the page, and that the credit cards were simply a separate problem she’d have to keep chipping away at on her own — $900 a month, most of it swallowed by interest. In reality, her renewal was the perfect moment to fix both at once, using equity she’d already built in her home.
“At renewal you’re not locked in — you’re free. That’s exactly the time to look.”
What we actually did
Shopped her renewal
Instead of signing at 4.24%, we placed her with a new lender at 3.99% — penalty-free because her mortgage was maturing.
Put her equity to work
We set up a home-equity line of credit and used it to pay the $30,000 of 18% credit cards down to zero.
Killed the 18% minimums
Roughly $900 a month in credit-card payments became $124 a month at 4.95% — and even her mortgage payment dropped.
| What it was | Balance | Rate | Monthly payment |
|---|---|---|---|
| Credit-card debt | $30,000 | ~18% | ~$900 |
| Cleared with home equity | $30,000 | — | ~$900 |
About $30,000 of high-interest credit-card debt — paid to zero and replaced by a home-equity line of credit at 4.95%, costing $124 a month instead of $900.
The before & after that made it a no-brainer
Here’s the whole picture. Her mortgage payment actually went down slightly, thanks to the lower rate. The $30,000 of 18% credit cards disappeared. And the balance now sits on a home-equity line of credit at 4.95% — a fraction of a credit-card rate — at $124 a month. Side by side:
| Monthly obligations | If she’d signed | What she did |
|---|---|---|
| Mortgage payment | $1,633 | $1,593 |
| Credit cards (~18%) | $900 | $0 |
| Home-equity line of credit (4.95%) | $0 | $124 |
| Total out the door each month | $2,533 | $1,717 |
$1,717 a month replaced $2,533 — and the expensive 18% debt is gone, at a rate below her renewal offer.
That’s roughly $815 a month — about $9,800 a year — back in her budget, with the 18% credit-card interest gone entirely and even her mortgage a touch cheaper. Her total borrowing of $333,000 against a home worth about $485,000 left her at roughly 68% loan-to-value, comfortably inside the 80% limit lenders allow, with about $152,000 of equity still in the home.
Just signing the renewal would have cost her
It’s worth spelling out what “doing what most people do” would have meant. If Rachel had signed the 4.24% letter and kept paying the cards, she’d have locked in a higher mortgage rate for five years and kept sending about $900 a month into 18% credit-card debt — a huge share of it pure interest, the balance barely budging. Year after year.
Could this work at your renewal?
This isn’t a rare, everything-lined-up-perfectly story. It’s one of the most common wins we see for Alberta homeowners right now. You may be a strong candidate to switch and consolidate at renewal if:
- You own a home in Edmonton, Calgary, or elsewhere in Alberta
- Your mortgage is coming up for renewal (or renewed in the last little while)
- You’re carrying higher-interest debt — credit cards, a line of credit, or a vehicle loan
- Your home has built up equity since you bought it
- Your lender’s renewal offer feels “fine,” but you’ve never actually had it shopped
Every renewal is different — your rate, your balance, your equity and your debts all vary from person to person. The only way to know whether switching and consolidating beats signing for your situation is to run your numbers. That part is free, and there’s no obligation.
Before you sign your renewal letter, see the other option
Find out whether switching lenders — and using your equity to clear high-interest debt at the same time — could lower your rate and free up your monthly cash flow. It takes minutes to start, and we’ll do the math for you.
Review My Options → Serving Edmonton, Calgary & all of Alberta · Mortgages for Less with INDI MortgageConsolidating debt at renewal: common questions
Can I switch lenders at renewal without a penalty?
Can I pay off credit cards using my home equity at renewal?
How much did it actually save per month?
Is 3.99% really better than my 4.24% renewal offer?
The line of credit is interest-only — isn’t that just kicking the can down the road?
Do I have to sell my home to get out from under high-interest debt?
I’m in Edmonton or a smaller Alberta town — can you still help?
How do I find out if this could work for me?
*Name and identifying details have been changed to protect client privacy. This case study is based on a real client file; the dollar figures shown reflect that file and are provided for illustration only, and the credit-card rate and minimum payment are typical figures used to illustrate the before-and-after. Every mortgage situation is different — rates, penalties, equity, qualification and results vary by individual and by lender, and are subject to change and to lender approval. Maximum refinance amounts in Canada are generally limited to 80% of a home’s appraised value. This article is general information, not financial, mortgage or legal advice. Please speak with a licensed mortgage professional about your specific circumstances. Mortgages for Less with INDI Mortgage.
