Porting A Mortgage

Porting A Mortgage

Porting a mortgage can help you save on fees, may help you lower your interest rate and often has less paperwork involved.

Table of Contents - Porting A Mortgage

Mortgage Portability

When you purchase a home, you select the mortgage that you feel will be best for you at that specific time. However, with today's busy lives, new children and ever-changing job market, more people are deciding to move before their mortgage term is done. If this sounds like you, then you will benefit from porting your mortgage.

Mortgage Portability, or porting a mortgage is when you take your current mortgage and bring it with you to your new home. When you bring your mortgage with you, you can avoid many penalties and fees.

Caution - when you do port your mortgage you must keep the same term and the mortgage amount has to be at least the same as what you currently owe or more, or it could trigger a penalty for you. See our frequently asked questions below for additional details.

Most lenders will allow you to port your mortgage. To find out for sure, give us a call at 519-960-0370 or email us at [email protected] and let us know who your mortgage lender is and we can double-check their terms and conditions for you. We do suggest speaking to a mortgage broker like LendCity first, instead of your bank directly as you may have additional options with a broker, which we will explain below.

When porting a mortgage, you can port and decrease, straight port, port and increase and a delayed port. With so many options it's best to speak to a professional to ensure your next home financing is set up exactly to best suit your needs.

Speak to a Mortgage Broker about your Mortgage Portability Options

Frequently Asked Questions - Porting

How can a port save me money?

When you port your mortgage, you will save any mortgage penalty, so long as the port is the same term and the same mortgage amount

What is a port and decrease?

A port and decrease are when you bring your mortgage with you from your existing home to your new home, but then decrease the amount to what's needed. This option may trigger a prorated mortgage penalty but should be much less than a full mortgage penalty.

What is a port and increase?

A port and increase is when you take your existing mortgage on your current home and bring it with you to your new home and increase the size of the amount. Many families and people with increased job income choose to do a port and increase. This option generally has no mortgage penalty, as long as you keep the same term that you have on your current home.

What is a delayed port?

A delayed port is when you purchase a new home and take possession of the home before your existing home sells. Generally, a delayed port will not trigger a mortgage penalty, so long as you keep the same mortgage balance or increase it.

Why is a port easier to apply for?

In most cases, when you port your mortgage, the lender has a track record of your payment performance as well as documents that might still be able to be used.

Why should I call LendCity instead of calling my bank for a port?

LendCity Mortgages has access to many lenders. In some cases, we have been able to save customers money by not porting their mortgage. We consider everything from what your mortgage penalty would be, your existing rate, to the new interest rate a new lender could give you. We compare the costs associated with both options and can present you with the lowest cost solution that saves you the most money. Also, as we have access to many lenders, we may be able to do your port for you. You can rest easy knowing you're having a team of professionals assist you on your homeownership journey.

If I have a mortgage now, will I be approved for a port?

Depends. If you have maintained your credit and income, then there should be no issue with approval. However, if your credit or financial situation has changed, you may not. It's best to speak to us first for a pre-approval to ensure we understand what you qualify for, before selling your home.

Avoid these mortgage porting mistakes

When porting your mortgage, avoid these most common home buyer mistakes;

  • Do not switch mortgage products when you try to port your mortgage, this will trigger a mortgage penalty.
  • Do not switch lenders, unless it makes financial sense as this will trigger a mortgage penalty. Always speak to your mortgage broker like LendCity because we have access to many lenders.
  • Do not skip a mortgage pre-approval. Financing rules and your credit history can change regularly.
  • Don't forget to see if your mortgage was insured with CMHC, if it was, you may be able to port your CMHC fee, reducing your closing expenses.

Check out our Step By Step Guide to Selling Your Home for additional information about the whole process.