The notary’s fee, weighed against the rate

A rate comparison alone made switching look like an easy call — 4.55% beats 4.95% every month of the term. But in Quebec, a mortgage is a hypothèque, and moving it to a new lender isn't the lawyer's discharge-and-re-register process used in most other provinces: it requires a brand-new notarial act, executed before a notary and published at the Registre foncier, with its own fee and its own timeline.

Comparing 4.55% to 4.95% without accounting for that fee isn't wrong, exactly — it's just an incomplete comparison for a province where a switch costs more to execute than the rate quote alone suggests.

Once the notarial fee was put into the comparison as its own line item, the switch still won -- but by a smaller, and more honest, margin.

The $64/mo saving compounds to $2,304 over the full 36-month term being compared — before the notarial fee is subtracted. Net of that fee, switching still comes out $854 ahead, but a shorter remaining term, or a smaller rate gap, could easily tip the same comparison the other way, exactly the kind of arithmetic behind Canada's own renewal statistics.

A courtier hypothécaire licensed under Quebec's Autorité des marchés financiers got a real number before recommending either option.

First, got a written notarial-fee quote before comparing anything. Called a notary directly for a firm estimate to prepare and publish a new hypothec deed, rather than assuming a round number.

Second, built the comparison as cumulative savings minus the one-time fee, not rate against rate. Multiplied the monthly saving by the term length in months, then subtracted the notarial fee to get one net number.

Third, disclosed the fee to the client before they committed to switching. The client chose to switch anyway, informed of the real net benefit rather than the headline rate gap alone.

The client switched lenders, saving $64/month for a $2,304 cumulative saving over the 36-month term compared, net $854 ahead of the $1,450 notarial fee the switch required.

A smaller rate gap, or a shorter remaining term, can flip this comparison -- the notarial fee is a fixed cost regardless of how much or little the rate actually saves.

• 01Switching lenders in Quebec costs more to execute than in most other provinces. A new notarial hypothec deed and Registre foncier publication are not optional steps.
• 02Get a real notarial-fee quote before comparing rates. A rounded estimate can make a marginal switch look better, or worse, than it actually is.
• 03Compare cumulative savings over the term against the one-time fee, not rate against rate. A small monthly saving needs a long enough term to clear a fixed cost.
• 04This fee doesn't apply to staying. Renewing with the existing lender keeps the existing deed registered as-is, with no new notarial act triggered.
• 05Disclose the fee before the client commits, not after. A client who switches informed of the real net number is making a different decision than one who switched on the rate alone.