Mortgage Delinquency Canada 2026: What Rising Arrears Mean

Quick answer

Why “mortgage delinquency Canada 2026” is suddenly in every headline

If you have searched this phrase, you are not alone. Canadians are typing it into Google late at night, often a few months before their mortgage comes up for renewal.

The headlines are real. Mortgage arrears — the share of mortgages more than 90 days behind on payments — are at their highest national level in five years, and the rise in Toronto has been sharp. A single percentage point, though, does not tell the whole story.

This guide walks through what the latest Canada Mortgage and Housing Corporation (CMHC) and Equifax Canada numbers actually say, helps you figure out whether the trend applies to your situation, and lays out the moves a homeowner can make — often well before a payment is at risk — given the rising mortgage payments at renewal most Canadians will face this year.

What the latest CMHC and Equifax data actually says

CMHC tracks the national mortgage delinquency rate quarterly. Its latest Residential Mortgage Industry Report puts the figure at 0.24%, meaning roughly one in every 415 Canadian mortgages is more than 90 days behind on payments. That has crept up from a record low of 0.14% in 2022, but it sits clearly below the 0.28% level Canada lived with just before the pandemic.

The bigger context is the renewal wave. CMHC and the Bank of Canada estimate that approximately 1.15 million mortgages will come up for renewal in 2026, on top of roughly 750,000 in the second half of 2025. Most were originally taken when the Bank of Canada’s policy rate sat at or below 1%. The average rate on a 5-year fixed uninsured mortgage was 2.36% in July 2020 and 3.95% in July 2025, according to CMHC, meaning a household renewing in 2026 may face payments several hundred dollars higher each month. That is the engine behind the arrears trend, and it explains why how Bank of Canada rates flow into mortgages matters more in 2026 than in any of the past several years.

Quick start: pick your path

Where in Canada is the pressure actually concentrated?

Behind the headline number is a country split in two. CMHC’s regional data shows the Greater Toronto Area’s arrears rate has roughly doubled over the past two to three years, from around 0.13% to about 0.24%, and the year-over-year jump is the steepest in more than a decade. Ontario as a whole has overtaken the national average for the first time since at least 2012.

Two structural factors explain the regional split. Mortgage balances are much larger in Toronto and Vancouver than elsewhere, so a 1-percentage-point payment increase at renewal hits a GTA household harder in absolute dollars than a similar household in Halifax or Winnipeg. And home prices in Ontario have softened since their 2022 peak, which can reduce the equity a homeowner might otherwise tap to refinance or sell their way out of trouble. For more on the local picture, see our Toronto housing market in 2026 guide.

What actually happens when a Canadian misses a mortgage payment

The single most useful thing to know is that the process is gradual. Missing one payment does not put your home at immediate risk; it starts a clock with consequences that escalate at predictable points.

Days 0 to 15 are typically a grace period at most Canadian lenders. A late fee of roughly $25 to $50 may apply, but credit bureaus are usually not notified yet. From day 16 to day 30, the payment is formally considered missed and the lender will almost always begin outreach.

At day 30, the missed payment is reported to Equifax and TransUnion, which can drop your credit score meaningfully. By day 60, most lenders will issue a formal demand letter. At day 90, the mortgage is officially counted as delinquent in CMHC and Equifax statistics, and beyond that the lender may begin legal recovery — which does not look the same in every province. Our mortgage glossary — power of sale, default, arrears covers the terminology in plain English.

In Ontario, New Brunswick, Newfoundland and Labrador, and PEI, lenders typically use power of sale, which begins with a notice giving the borrower 35 days to bring the mortgage current. In BC, Alberta, Saskatchewan, Manitoba, and Nova Scotia, the process is judicial foreclosure, supervised by the court and generally taking several months. Quebec operates under the Civil Code, where the lender must serve a prior notice of the exercise of a hypothecary right; the process is overseen by the courts and finalized by a notary. The naming differs, but the principle is the same: the homeowner has weeks, not days, to act.

The five-step playbook if you’re worried about your next payment

1. 1
   Contact your lender before you miss a payment The Canadian Mortgage Charter, a federal framework introduced in 2024, sets the expectation that federally regulated lenders offer meaningful hardship relief to borrowers under payment stress — including extending amortization, capitalizing missed interest, deferring a payment, or waiving certain prepayment charges. The Charter applies primarily to federally regulated banks; credit unions and some monolines are provincially regulated.
2. 2
   Run the refinance numbers with a broker who shops the full market An independent mortgage broker can compare offers across more than 50 banks, credit unions, trust companies, and monoline lenders in a single application. For a homeowner approaching renewal, that comparison often surfaces a rate or term the renewal letter did not offer. The broker is paid by the lender, so the service is typically free to the borrower.
3. 3
   Consider extending your amortization to ease monthly cash flow Amortization is the total length of time you have to pay off your mortgage. Stretching it — for example, from 20 years remaining out to 25 or 30 — can reduce your monthly payment, though you typically pay more total interest over the life of the loan.
4. 4
   Consolidate higher-interest debt into your mortgage where the math works If credit card balances, lines of credit, or auto loans are eating the cash flow that funds your mortgage payment, rolling those balances into a refinance can sharply reduce total monthly debt servicing. Our guide on how to consolidate higher-interest debt into your mortgage covers the mechanics and limits.
5. 5
   Explore alternative or B-lender options before a payment is missed If a traditional bank refinance is not available — because of recent credit damage, self-employed income, or higher debt service ratios — alternative or B-lenders may still be an option. These typically come with higher rates and fees, but they can bridge a household through a difficult window. Complex files like these are exactly what Razi Khan, Founder and Mortgage Broker at Pegasus, and the broader Pegasus team work through every week.

Common mistakes homeowners make under payment stress

• Waiting until after a missed payment to call the lender. Hardship-relief options open up much more freely when the conversation happens proactively, especially under the Canadian Mortgage Charter for federally regulated lenders.
• Auto-renewing at the lender’s posted offer without shopping the market. Renewal letters often quote rates that are not the best available. Our guide on why working with a broker beats auto-renewing covers this in more depth.
• Putting a mortgage shortfall on a credit card or unsecured line of credit. Credit card interest typically runs above 19%, which deepens the cash-flow problem rather than solving it.
• Skipping a payment without arranging a formal deferral. Without a deferral agreement, you can end up in “rolling late” status, where every subsequent payment is treated as late until you double up.
• Liquidating RRSPs or TFSAs as a first response. Withdrawals can trigger tax, lose contribution room, and drain a retirement cushion — often before a refinance has even been priced.
• Assuming one missed payment triggers immediate foreclosure or power of sale. Legal recovery typically begins only after multiple missed payments and a formal demand letter, with timelines of weeks to months depending on the province.

Frequently asked questions about mortgage delinquency in Canada

About the author

Razi Khan

Founder, CEO & Licensed Mortgage Broker · Pegasus Mortgage Lending · Toronto, Ontario · FSRA Lic # 11479

Razi Khan is the Founder, CEO, and a licensed Mortgage Broker at Pegasus Mortgage Lending Center Inc., based in Toronto. With over 20 years of experience in the Canadian mortgage industry, Razi has personally guided more than 3,000 clients through some of the most complex and high-stakes financial decisions of their lives — from first-time purchases in the GTA to refinancing strategies, alternative lending solutions, and cross-border mortgages for Canadians buying in the United States.

Razi founded Pegasus in October 2008, launching the brokerage at the height of a global financial crisis. He works across the full spectrum of borrower profiles, with particular expertise in complex files including self-employed borrowers, credit-challenged clients, and investors building multi-property portfolios.

Learn more about Razi Khan →

Sources & References

1. CMHC — Mortgage Delinquency Rate: Canada, Provinces, CMAs (quarterly data tables). cmhc-schl.gc.ca
2. CMHC — Residential Mortgage Industry Report (Spring 2026). cmhc-schl.gc.ca
3. CMHC Housing Market Observer — Mortgage renewal wave (February 2026). cmhc-schl.gc.ca
4. Government of Canada — Canadian Mortgage Charter. canada.ca
5. OSFI — Guideline B-20: Residential Mortgage Underwriting. osfi-bsif.gc.ca
6. Financial Consumer Agency of Canada — Trouble paying your mortgage. canada.ca / FCAC
7. Ontario Mortgages Act, R.S.O. 1990. ontario.ca
8. Civil Code of Québec, articles 2757–2758. legisquebec.gouv.qc.ca