One of the most common questions we get as Toronto mortgage brokers is “Are portable mortgages more expensive?” It really depends on if you’re going to use the features of a portable mortgage or not; if you’re going to move around at least once during the lifetime of your loan you’re going to be able to make the most of your mortgage! This is the kind of Canadian mortgage that works for people who move often for work, but not for people who see themselves staying in the same place for the next 15 years.
What is a Portable Mortgage?
First to know if they’re more expensive, we have to know what they are! A portable mortgage is just like any other mortgage offered by your lender, but it has one very important feature: portability. Debt portability is important for people who move a lot. You’ll be able to move the mortgage you have now with its great terms and the same balance; you’ll be able to pay the same monthly payment you pay now, and you’ll have to pay a small transfer fee to get your mortgage moved to the new property.
It works like this:
You buy a beautiful house with a low interest rate (yay!), and you live here for about 5 years. Your company decides to move you to Calgary; without a portable mortgage you’d be in for some trouble. You will have to find a realtor to help you sell, you’ll have to pay closing costs, find a real estate lawyer, and hope that whatever you net from the sale of the home after all these fees can cover a new home. If your situation has changed you may face a big jump in interest rates and the terms you get for your next mortgage may not be nearly as favourable as the one you enjoy now.
Is a Portable Mortgage Right for You?
You’ll want to speak with one of our Toronto mortgage brokers to make sure that this is the right choice for you. You’ll be able to get a great mortgage now that you can move to your next home when the time comes. You won’t have to pay massive closing costs and you won’t have to worry about things getting out of hand when you’re trying to get money together to buy a new home. Portable mortgages are a great choice for people who will need to move at least once in the next 10-15 years; if you don’t have a job or a situation where you’ll need to move, you may want to consider a normal mortgage instead.
A portable mortgage usually has a slightly higher interest rate. You’ll want to talk with one of our Toronto mortgage brokers to make sure that you’re making the right choice for your situation. We’ll help you find the best interest rate and terms to fit your finances and your lifestyle; check it out today and see how you can save!
To learn more about our great rates on portable mortgages, click here!