Mortgage transfer fees: who really pays when you switch lenders
Switching your mortgage to a new lender at renewal can cost little or nothing out of pocket, or a few thousand dollars, depending on who covers which fee. Here's a cost table for discharge, legal, appraisal and assignment fees, who usually pays, and a worked example.
When you transfer (switch) your mortgage to a new lender, the usual costs are a discharge or assignment fee from your current lender, legal or notary work, sometimes an appraisal, and registration. FCAC says discharge fees typically run from nothing to $400 where provinces don't regulate them, and professional fees are typically $400 to $2,500. At maturity there's no prepayment penalty. In our experience, the new lender often covers legal and appraisal costs on a straight switch, leaving you with the discharge fee. In our $420,000 example, a rate 0.25 points lower saves about $4,900 in interest over five years, so even $1,700 of fees is recovered in about 30 months.
Key takeaways
- →The main mortgage transfer fees are your current lender's discharge or assignment fee, legal or notary costs, a possible appraisal and land-registry charges.
- →Discharge fees typically range from $0 to $400 where a province doesn't cap them, per FCAC; legal or notary fees are typically $400 to $2,500.
- →Who pays is negotiable. FCAC suggests asking the new lender to cover some or all of the costs; in our experience, many do on a straight switch at renewal.
- →Switch at maturity to avoid a prepayment penalty. Mid-term, the penalty is usually the biggest cost by far.
- →Federally regulated lenders can add up to $3,000 of switching costs to the balance and still treat an uninsured move as a straight switch, per OSFI.
Short answer: Mortgage transfer fees in Canada usually include a discharge or assignment fee from your current lender, legal or notary work to register the new mortgage, sometimes an appraisal, and land-registry charges [1] [2]. FCAC says discharge fees typically range from nothing to $400 where they aren't regulated, and professional fees typically from $400 to $2,500 [2]. At the end of your term there's no prepayment penalty, and the new lender will often cover part or all of the rest, so ask before you assume you're paying [1].
This guide is about the costs and who pays them. If you're comparing renewal offers, our mortgage renewal page explains how we shop your renewal across lenders.
What counts as a mortgage transfer fee?
A "transfer" or "switch" means moving your existing balance to a new lender, usually at renewal. Your current lender's charge on the title has to be removed and the new lender's added, or the mortgage is assigned to the new lender [2]. FCAC lists the possible costs: discharge, registration, transfer or assignment fees from your current lender, an appraisal if needed, and other administration fees [1].
Mortgage transfer fees at a glance
| Cost | Typical amount | Who usually pays |
|---|---|---|
| Discharge fee (current lender) | $0 to $400 where not regulated; some provinces cap it [2] | You, unless the new lender reimburses it (our experience) |
| Assignment or transfer fee | Varies by lender [2] | You, unless covered (our experience) |
| Legal or notary fees | Typically $400 to $2,500 [2] | Often the new lender on a straight switch (our experience) |
| Appraisal | Varies; only if the lender needs one [1] | Often the new lender, or waived (our experience) |
| Land-registry charges | Set by your province | Usually bundled into the legal package (our experience) |
| Prepayment penalty | $0 at maturity; can be thousands mid-term | You |
Fee ranges from FCAC [1] [2]; "who usually pays" is our experience across lenders, not a rule. Get every amount in writing.
Federally regulated lenders, such as banks, must disclose the discharge fee in your mortgage contract, so check yours before you shop [2].
Who really pays: the three common set-ups
- New lender covers legal and appraisal; you pay the discharge fee. In our experience, this is a common set-up for a straight switch at renewal. Your out-of-pocket cost is often just the discharge fee.
- New lender gives a cash allowance toward costs instead of paying the lawyer directly. Compare it with your real costs, not the headline.
- You pay everything but get a sharper rate. This can still make sense; the worked example below shows how fast the rate difference pays back the fees.
FCAC's advice is simple: ask whether the new lender will pay some or all of the costs to switch [1], and ask the new lender specifically about covering the discharge [2].
Renewal coming up? A licensed 8Twelve agent can compare switch offers from 65+ lenders, including who covers which fee, at no cost to you, OAC. Compare your renewal options
Worked example: do the fees pay off?
Illustration: your $420,000 mortgage is renewing with 20 years left. Your lender offers 4.69% for five years; another lender offers 4.44%. Rates are assumptions for illustration, not quotes.
| Stay (4.69%) | Switch (4.44%) | |
|---|---|---|
| Monthly payment | about $2,690 | about $2,634 |
| Interest over 5 years | about $89,700 | about $84,800 |
| Balance after 5 years | about $348,300 | about $346,700 |
| Interest saved over 5 years | — | about $4,900 |
Calculated in Python with semi-annual compounding; same 20-year amortization in both.
- If the new lender covers legal and appraisal and you pay a $300 discharge fee, you're about $4,600 ahead after five years and recover the fee in about 5 to 6 months.
- If you pay $1,700 in total ($300 discharge, $1,000 legal, $400 appraisal), you're still about $3,200 ahead and recover the costs in about 30 months.
Fees that can catch you out
- Breaking mid-term. Switching before maturity usually means a prepayment penalty, which often outweighs everything else. Our guide to refinance costs explains how penalties are calculated.
- A collateral charge. If your mortgage is registered as a collateral charge, switching may involve extra fees to remove it and register the new charge, and any other loans secured by it must be repaid or moved [1].
- Mortgage insurance. If your mortgage is insured, give the new lender your insurance certificate number; you may avoid paying a premium twice, but increasing the amount or extending the amortization can mean a new premium [1].
- Adding costs to the balance. OSFI lets federally regulated lenders add up to $3,000 of transaction costs, such as fees, to an uninsured balance and still treat the move as a straight switch [3]. Add more, or extend the amortization, and the new lender will qualify you as a new loan. Our switch stress test guide covers who qualifies.
Questions to ask before you sign
- From your current lender: the discharge or assignment fee in writing, and whether your mortgage is a standard or collateral charge [1].
- From the new lender: which costs they cover (legal, appraisal, discharge) and whether it's a direct payment or a cash allowance.
- From the lawyer or notary: a written quote including registration charges and disbursements.
- On timing: start a few months before maturity, as FCAC recommends, so the switch closes on your renewal date [1].
When switching may not be worth it
- If the rate gap is tiny and you'd pay all the fees. A gap of a few hundredths of a point may not cover $1,500 to $2,500 of costs over a short term.
- If you're mid-term with a large penalty. Wait for maturity, or ask your lender about options such as a blend-and-extend; see our blend-and-extend vs refinance guide.
- If your current lender matches. FCAC encourages negotiating with your current lender using competing offers [1]; our renewal negotiation scripts show what to say.
From our desk: the switch fee question is usually settled in one email. Ask the new lender, in writing, exactly which costs they'll cover before you accept the rate.
Mortgage transfer fees are real but modest at maturity, and they're often partly or fully covered by the new lender. Get the discharge fee from your current lender, ask the new lender what they'll pay, and compare the net saving over the term, not just the rate.
Run the numbers: compare your renewal offer with our mortgage renewal calculator, or read our complete mortgage renewal guide.
This article is for general information only and isn't financial, legal or tax advice. Rates, products and terms change without notice and are available on approved credit (OAC). The rate and terms you qualify for depend on your individual financial situation, including credit, income, property and loan-to-value. "Best rates" means the most suitable options available for your situation, not a guarantee of the lowest rate. Example rates and payments are for illustration only, as of October 2026, and are not an offer. 8Twelve Mortgage arranges mortgages through 65+ lenders and does not lend directly. Licensed across Canada — see our licences.
Example rates, fees and payments are for illustration only, as of October 29, 2026, and are not an offer. Fees vary by lender, province and lawyer or notary; "who usually pays" reflects our experience, not a rule, and every switch is subject to the new lender's approval, OAC. Fee ranges checked against FCAC and OSFI on October 29, 2026.
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Last reviewed on October 30, 2026