Porting A Mortgage – How to Take Your Low Mortgage Rate to Your Next Home
Let’s talk about porting your mortgage. It sounds complex, but it’s actually a pretty simple concept that can make your home-buying experience much smoother. Porting your mortgage means transferring your existing mortgage—along with its current rate, terms, and balance—from your current home to the new one you’re purchasing. This can be a huge advantage, especially if you’re locked into a good interest rate or have terms you don’t want to give up just because you’re moving.
One of the most common questions people ask is, “My mortgage is locked in for a few more years, can I still buy a new home?” The good news is, yes, you absolutely can!
Most mortgages are portable, which means you can take the existing balance, rate, and term of your current mortgage and apply it to the new property. However, there’s one thing to keep in mind—the timing. Typically, the closing dates of your current home and your new one need to be within a certain time frame, usually 90 days. So, it’s essential to plan accordingly to ensure you can take advantage of porting without any hiccups.
But what happens if you need a bigger mortgage for the new home? If that’s the case, you may be able to “blend and extend”—this means your lender could offer you a new mortgage that combines your existing rate with a higher one for the additional amount you need. While this can result in a blended interest rate that’s somewhere between your current rate and the new one, it can still offer savings, especially if current rates are higher than what you’re locked into.
On the flip side, if you’re downsizing, there’s a chance you’ll need less money than what remains on your current mortgage. In this case, you might have to pay a penalty for the portion of the mortgage you no longer need. Again, these penalties can vary, so it’s important to check with your mortgage professional to fully understand how it applies to you.
Porting your mortgage can save you time and money, but it’s not always straightforward. Every situation is unique, and while the basics remain the same, the finer details depend on your lender and your specific circumstances. If you’re considering a move, don’t hesitate to reach out to me or your mortgage professional. We can walk you through the process and help you make the best decision for your financial future.
Have questions about porting your mortgage or making your next move? Drop a comment below or send me a message—I’m here to help you navigate the process and find the best option for your situation! Let’s chat!
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