When you buy a new house you’ll be able to “port” a portable mortgage from the old one to the new one, that’s what makes it portable! But to move it you’re going to have to get a portable mortgage first; this means you’re going to need a good mortgage lender and decent credit to get the best one. This also means you’re going to want to work with the best Toronto mortgage broker, and that means us! We’ll work hard so you don’t have to. Here we’re going to talk about how portable mortgages work and how to move it to your new home when you’re ready. Let’s get started!
Just What is a Portable Mortgage?
Canadian portable mortgages allow you to keep great mortgage terms and move it from one place to another. There’s something known as “negative equity”, which means that the balance on your previous home moves to your new home. You shouldn’t let a few thousand dollars owed on your old house stop you from getting a new one, but before you think about a portable mortgage talk to a Toronto mortgage broker. This way you’ll know if a portable mortgage is right for you.
It’s important to remember to get a portable mortgage you will need good credit and a good lender who won’t gouge you! This means you’re going to want to work with a Toronto mortgage broker to get the best deal. The last thing you need is a bad portable mortgage that you’re stuck with for the next 25 years.
How do Portable Mortgages Work?
We’ll just assume you already have one on your current home. You decide to move but you still owe some money on your first house. You could take out a bridge mortgage and pay thousands and thousands of dollars to bridge your financing gap, or you could just port you good terms instead. You will have to pay a small transfer fee, but beyond that you’ll be able to keep the great low interest rates and good terms you enjoyed on your first property for your second property.
If you owe money on your first property, you’ll have “negative equity”. Whatever you owe on your first home will move to your second home, but that’s okay. It’ll give you more time to pay it off and you’ll be able to avoid any problems that would delay the purchase of your new home. Most portable mortgages work throughout Canada and you’ll be able to move if you need to.
Do You Need a Portable Mortgage?
It’s important to note that these kinds of mortgages do have slightly higher interest rates and credit demands, but they’re worth it if you intend to move in the first ten to fifteen years. The cost of moving and taking out an entirely new mortgage (not to mention selling your first house) can be expensive. Don’t let this prevent you from living your dream. Visit our portable mortgage page today to learn mroe!