Blend-and-Extend Mortgage Calculator
Your bank is offering a blend-and-extend. Is it actually a good deal — or should you break your mortgage and switch? This calculator runs the math both ways using Canadian semi-annual compounding.
Blend-and-Extend Calculator
See your blended rate and whether blend-and-extend beats breaking your mortgage early.
Simplified comparison using 3-month interest penalty. Actual bank IRD penalties can be much higher — use the penalty estimator for a more accurate break scenario.
Your blended rate is 4.49% — saving $208/month vs. your current rate.
A broker will confirm this with real lender quotes — for free.
How Blend-and-Extend Works in Canada
All Big 6 Canadian banks (TD, RBC, BMO, Scotiabank, CIBC, National Bank) offer blend-and-extend on fixed-rate mortgages. The bank weights your existing rate and today's rate by the months they apply to — then offers you that blended rate on a new, extended term (usually 5 years from today).
Example: You have 24 months left at 5.25%. Today's 5-year rate is 4.19%. The bank offers: (24 × 5.25% + 60 × 4.19%) ÷ 84 = ~4.49% on a new 5-year term. You skip the 3-month interest or IRD penalty — the trade-off is you're locked in with your current lender.
When Blend-and-Extend Beats Breaking
- You have 18+ months left on your term (blending captures more of the new rate).
- You're with a Big 6 bank that would use posted-rate IRD on a break (penalty often $10K+).
- You want to stay with your current lender for other reasons (existing HELOC, relationship).
- You believe rates may rise in the 1–2 years remaining on your current term.
When Breaking Beats Blend-and-Extend
- You're with a monoline lender (First National, MCAP) that uses a fair 3-month interest penalty.
- Only 6–12 months remain — blending preserves too much of your high rate.
- A competitor is offering legal-paid switches and a rate significantly below today's market.
- You want to switch to a variable rate (blend-and-extend usually keeps you fixed).
Frequently Asked Questions
What is a blend-and-extend mortgage? +
A blend-and-extend is a Canadian bank product that lets you access today's rate before your term is up by blending your current rate with the new rate, weighted by the time remaining. Your current term is extended (usually to a new 5-year term) without paying a prepayment penalty.
Is blend-and-extend always better than breaking my mortgage? +
Not always. If today's rate is significantly lower than your current rate and your remaining term is short, breaking the mortgage and paying the 3-month interest penalty (or IRD) can save more over the new term. Use the comparison in our calculator to model both scenarios.
Which banks offer blend-and-extend? +
All Big 6 banks (TD, RBC, BMO, Scotiabank, CIBC, National Bank) offer blend-and-extend on their fixed-rate mortgages. Monoline lenders like First National and MCAP typically do not — instead, they charge a fair 3-month interest penalty to break.
Does blend-and-extend reset my amortization? +
No. Blend-and-extend keeps your existing amortization schedule. Only your rate and remaining term change. If you want to extend amortization (for lower payments), that's a separate request and requires a full refinance and stress test.
Can I blend with a different lender? +
No. Blend-and-extend is only offered by your current lender — it's a tool they use to retain you. If you want to switch lenders, you'll need to break your mortgage, pay any penalty, and transfer to the new lender.
Related Guides
Prepayment Penalty Calculator
Estimate IRD or 3-month interest before breaking early.
IRD vs. 3-Month Interest Penalty
Breaking a mortgage early — how both penalty methods are calculated.
Early Mortgage Renewal
Renewing before maturity — penalties, timing, and when it pays.
Switch vs. Stay Calculator
Compare staying with your lender vs. switching, net of fees.
Break-Even Switch Calculator
How many months until switching lenders pays for itself.
All Renewal Calculators
Payment, stress test, switch break-even, prepayment — all in one place.
Want a Broker to Run Both Scenarios?
A licensed mortgage broker will call your bank for the exact blend offer and compare it against today's best switch rates — free.