Collateral vs standard charge
A standard charge registers your mortgage for exactly what you borrowed and can be handed off to a new lender at renewal, while a collateral charge registers a larger re-usable claim on your home that a new lender generally won't accept, so switching means discharging and re-registering.
When you get a mortgage, the lender registers a legal claim against your home at the provincial land registry. This is called a charge, and it's what lets them take the property if you stop paying. There are two ways to register it. A standard charge (also called a conventional charge) is registered for the exact amount you borrowed at the exact rate and term. A collateral charge is registered as a re-usable line of security, often for an amount well above what you actually borrowed, so the lender can later lend you more against the home without registering anything new.
The collateral version sounds convenient, and sometimes it is: if you want a home equity line of credit or plan to borrow more later, the lender can bump up your loan without a fresh lawyer and registration bill. The catch shows up at renewal. A standard charge can be assigned, meaning the exact registered claim is transferred from your old lender to a new one when your term ends. A collateral charge generally cannot be assigned; new lenders won't take it over. To leave, your old mortgage has to be discharged (formally removed) and a brand-new charge registered by the new lender, which usually means legal and registration fees running several hundred to roughly a thousand dollars or more.
That fee is small next to a mortgage, but it does two things. It adds friction and a real cost to leaving, and it's often enough to make people stay put rather than shop the renewal. That matters, because surveys from CMHC and the Financial Consumer Agency of Canada (FCAC) have long found that a large majority of Canadians renew with their existing lender without comparing offers, which is exactly when a lender has the least pressure to give you its sharpest rate. Some lenders register every mortgage as a collateral charge by default. TD, for example, has registered its mortgages this way since 2010, and Tangerine does the same. You usually aren't asked; it's just how they set it up.
None of this makes a collateral charge a bad deal, and none of it traps you: you can still switch, and many competing lenders (especially monoline lenders that only do mortgages) will cover your switch costs to win your business, which cancels out the fee. The point is to know how yours is registered before you sign, ask the lender directly, and factor the switching friction into the rate you accept, rather than discovering it at renewal.