Last reviewed: 3 October 2026
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Mortgage relief options in Canada
If your Canadian mortgage payments become hard to meet, the Financial Consumer Agency of Canada (FCAC) lists a range of options. This page sets them out in the FCAC’s words, with the costs it says come with each. It does not say which to use.
What this term means: Amortization is the time it takes to pay off your mortgage in full. The FCAC defines it that way and separates it from your term, which is the length of time your mortgage agreement is in effect.[1]
When payments can become hard to meet
The FCAC gives examples of exceptional circumstances: the combined effects of high household debt, increased cost of living and rapid increases in interest rates.[1] It says rapid rate increases may matter if you need to renew a fixed-rate mortgage soon and face much higher payments, have a variable-rate mortgage with much higher payments, or have a variable-rate mortgage with fixed payments and have reached, or expect to reach, your trigger rate.[1]
The trigger rate is the rate at which your payment only covers interest costs, so none of it pays down the principal.[1] The FCAC says the financial institution will generally add unpaid interest to your balance, which puts the mortgage in negative amortization, and that institutions normally charge interest on the unpaid interest.[1]
The options the FCAC lists
Renegotiating your mortgage
- Converting from a variable to a fixed rate. The FCAC says you may be able to do this and that it may also protect you against a sudden rate increase.[1]
- Blend-to-term. Your financial institution combines your mortgage rate and the current rate into a new rate that applies until the end of your term.[1]
- Blend-and-extend. You extend the length of your term so the new rate applies for longer; institutions also call this an early renewal.[1] The FCAC says blended options may lower your payments if the current rate is lower than your current mortgage rate.[1]
Using features in your mortgage agreement
- Prepaying and re-borrowing. If you made extra payments, your institution may let you re-borrow them; it will typically add the amount to your principal, which increases your interest costs.[1]
- Skip-a-payment. Your institution may offer it, for a maximum number of payments each calendar year, and may require a prepayment first. Otherwise you defer the payments.[1]
- A home equity line of credit (HELOC). The FCAC says using a HELOC to make your mortgage payment may put you at risk, because the institution may lower your limit or ask you to pay the full amount at any time.[1]
- A credit insurance claim, if you have optional credit insurance and, for example, lose your job, become critically ill or become disabled.[1] The FCAC says you typically wait 1 or 2 months before claim payments start, and the maximum monthly benefit is usually around $3,000 for a limited time.[1]
Other relief measures
| Measure | What the FCAC says |
|---|---|
| Payment deferral | You delay payments for a specific period, usually up to 4 months, then resume. You must repay the deferred payments.[1] Afterwards your amortization may be longer, you will owe more than before, and your payment may increase.[1] |
| Extended deferral | A deferral longer than the standard period, usually up to a predefined amount, for example $10,000.[1] |
| Longer amortization | Extending your amortization lowers your payments, but the longer you take to pay off the mortgage, the more interest you pay.[1] |
| Special payment arrangements | Your institution may offer arrangements unique to your situation, which may include reduced payments for an agreed period.[1] |
| Capitalization | Your institution allows you to add late payments to your principal; it may allow this for missed payments and interest, property taxes, utility bills, repair costs, condo fees and other outstanding charges. It then increases your payments to reflect the larger principal.[1] |
| Interest-only payments | Your institution may let you pay only the interest portion, deferring principal; the FCAC says this may be the case if you have already extended your amortization or used capitalization.[1] The FCAC says deferred principal is usually capped at about $10,000 and is usually repaid within 2 years.[1] |
The cost of a longer amortization: the FCAC’s illustration
The FCAC gives an illustration only: a $300,000 mortgage at a 5% interest rate.[1]
| Amortization | Monthly payments | Interest costs |
|---|---|---|
| 20 years | 240 monthly payments of $1971.38[1] | $173,130[1] |
| 30 years | 360 monthly payments of $1601.07[1] | $276,386[1] |
These are the FCAC’s example figures only. The FCAC says that if your down payment is under 20% of the home’s price, the maximum amortization is 30 years for a first-time buyer and/or a new build, and 25 years in all other cases; above 20%, your lender sets it.[1] It says federally regulated institutions are expected to develop a plan with you when they extend your amortization and you are at risk of default, covering a reasonable total amortization, options to restore the original period, and an assessment of the long-term negative financial implications.[1]
Selling your home
The FCAC says selling is an option if you are at risk of default and in severe financial difficulty, and lists possible effects: lower payments if you downsize, lower expenses, and access to your equity.[1] It describes a “sale by borrower” plan: your institution allows you to sell at fair market value while you live in the home, typically for 90 days or less. You agree to occupy and maintain the home and may need to keep making full or partial payments.[1]
How to verify this yourself
Read the FCAC page in the reference list; it is the source for every statement above. Then read your own mortgage agreement for the features it includes, as the FCAC advises, and ask your financial institution which relief measures it offers. For the amortization limits and the difference between term and amortization, see our guide to Canadian terms and amortization. For who regulates what, see the FCAC’s federal role. Our published standard covers US originators only; there is no Canadian Register.
What this page does not cover
This page is general information, not financial or legal advice. It does not say which option suits anyone. It describes the FCAC’s expectations of federally regulated institutions; it does not say what any provincially regulated lender or broker must offer. It does not cover insolvency, consumer proposals, or what happens if a lender starts enforcement. Terms, caps and amounts vary by institution and contract. The FCAC page details are dated 15 October 2025. This page was last reviewed 3 October 2026.
Your next step
If payments are becoming hard to meet, contact your financial institution now and ask which of these measures it offers and what each would add to your total cost. Return to the Mortgage help library for related guides.