Mortgage renewal in Quebec: hypothecs, notaries and what changes when you switch

Renewing a mortgage with your current lender in Quebec works much as it does elsewhere in Canada: you receive a renewal offer, negotiate, and sign it, with no notary needed. The differences appear when you switch lenders. In Quebec a mortgage is a hypothec under the Civil Code of Québec, and moving it to a new lender usually means a new deed of hypothec signed before a notary and a release (mainlevée) of the old one, which adds cost and time. Mortgage brokers are regulated by the Autorité des marchés financiers (AMF), and Desjardins caisses are supervised by the AMF rather than federal regulators, which changes where you complain and which rules apply.

This guide is part of the mortgage renewal rates overview. Costs are illustrative examples; ask for written quotes.

Key terms in Quebec

Renewing with your current lender

If you stay, the lender sends a renewal offer. You negotiate the rate and terms the same way as anywhere else in Canada: get written offers from other lenders and ask your lender to beat them. No notary is normally involved, because the existing hypothec stays in place.

If your lender is a bank, it is federally regulated, so federal rules on renewal statements and FCAC's oversight apply. If your lender is a Desjardins caisse or another Quebec-chartered institution, Quebec rules and the AMF apply instead.

Switching lenders in Quebec

A switch usually involves these steps:

1. The new lender approves your application and issues a commitment.
2. You choose a notary, or the new lender proposes one.
3. The notary obtains a payout statement from the old lender and prepares a new deed of hypothec.
4. You sign the deed before the notary.
5. On the funding date, the new lender pays out the old mortgage through the notary.
6. The notary registers the new hypothec and arranges the mainlevée of the old one.

Some lenders pay part or all of the notary fees for a switch, sometimes in the form of a cash contribution. Ask each lender exactly what it covers, because this can decide whether switching pays.

Worked example: does a switch still pay with notary fees?

Illustrative figures: $420,000 balance, 20 years left, five-year fixed.

• Renewal offer: 4.49%, interest over five years about $85,738
• Outside offer: 4.19%, interest over five years about $79,851
• Interest saved over the term: about $5,887

Switching costs you would pay, illustrative only:

• Notary fees and registration: $1,300
• Old lender's discharge or administration fee: $300
• Appraisal: $0, covered by the new lender
• New lender's contribution to costs: -$800

Net cost: $1,300 + $300 - $800 = $800. The switch still saves about $5,087 over five years ($5,887 - $800). With a smaller rate gap, say 0.10 point, the interest saving would be roughly a third as large, about $2,000, and the same $800 net cost would take about 40% of it. If the new lender paid nothing towards costs, the net cost would be $1,600 and most of the saving would disappear. Run your numbers in the renew-vs-switch calculator.

Collateral-style hypothecs

Some Quebec lenders register a hypothec for a higher amount than the loan, sometimes up to the value of the property or more, so you can borrow again later without a new deed. This is convenient for lines of credit, but another lender generally cannot simply take it over. A switch then needs a new deed and a full mainlevée. See collateral charges and switching costs.

Mortgage brokers in Quebec

Since 1 May 2020, mortgage brokerage in Quebec has been supervised by the AMF, which took it over from the real estate brokerage regulator. A mortgage broker must be registered and listed in the AMF's register. Check the register before sharing documents. A broker can shop your renewal across several lenders, but is usually paid by the lender that funds the mortgage, so ask how they are paid.

Language of the contract

Under the Charter of the French language, as amended in 2022, standard-form (adhesion) contracts generally have to be given to you in French first. You can then ask to be bound by a version in another language, such as English. If you prefer English documents, tell the lender and notary early so the timeline is not delayed. Ask your lender how it applies this to renewal documents.

Complaints in Quebec

• For a bank: use the bank's complaint process, then the Ombudsman for Banking Services and Investments. FCAC supervises the bank's compliance. See mortgage complaints.
• For a caisse or Quebec-chartered institution: use its complaint process, and if you are not satisfied, ask the institution to transfer your complaint file to the AMF, which can offer dispute resolution services such as mediation.
• For a mortgage broker: complain to the brokerage first, then to the AMF.

Checklist for a Quebec switch

• Confirm whether your hypothec is a standard or collateral-style hypothec
• Ask the new lender which notary fees and costs it pays
• Ask your current lender for its discharge or mainlevée fees
• Book the notary early, especially near month-end and in spring
• Confirm the funding date matches your maturity date
• Say early if you want English-language documents
• Check any broker in the AMF register

The federal rules on qualifying for a switch apply in Quebec as elsewhere for banks; see the stress test when switching. Insured pricing also carries over in the same way; see insured vs uninsured renewal rates.

Frequently asked questions

Do I need a notary to renew with my current lender?

Generally no. A renewal with the same lender keeps the existing hypothec, so you sign the renewal agreement only.

Is the welcome tax charged when I switch lenders?

No. The property transfer duties often called the welcome tax apply when ownership of a property is transferred, not when the hypothec moves to a new lender.

Are Desjardins caisses covered by the federal Mortgage Charter?

The Charter is addressed to federally regulated lenders. Caisses are supervised by the AMF, so ask your caisse which relief options it offers and check the AMF's guidance.

Does the Interest Act apply in Quebec?

Yes. It is a federal law and applies across Canada, including its rules on how mortgage rates are stated and on terms longer than five years.

Sources

• Autorité des marchés financiers — mortgage brokers, caisses, the register and dispute resolution
• Chambre des notaires du Québec — the notary's role and finding a notary
• Office québécois de la langue française — language rules for contracts
• Financial Consumer Agency of Canada — federal rules for banks
• Justice Laws Website — the Interest Act