# Port or transfer mortgage?



## Maybe Later (Feb 19, 2011)

I currently have a VRM, prime -0.75%, with four years remaining on the five year term and an amount owing somewhere between 40 & 45% of the last appraised value of our home (our first house). We're thinking of moving and I'm wondering:

(a) is the mortgage of potential value to many buyers to take over as part of the home sale? 

(b) how painful is it to transfer to a new property vs. new financing and is it complicated by having a HELOC on our current home?

Ultimately I will crunch the numbers if/when we have an offer and if/when we find a suitable new home, but I'm wondering about others' experiences. I have one co-worker who was stressed out by trying to close on a new house after selling their townhouse in time to transfer the mortgage, but I know this is just one story.


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## K-133 (Apr 30, 2010)

Better question (for your bank), are you allowed to port your variable rate mortgage?


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## arie (Mar 13, 2011)

*mortgage*

generally the motgages are not taken over by a purchaser ; in any event even if permitted you do not want it because having signed the original mortgage document you will remain liable and open to possible problems if the new purchaser defaults

see if you can port it ; the banks presently are not giving .75 under prime any longer and its a rate you would want to keep


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## luisa (Dec 7, 2011)

We have a variable rate mortgage at 0.6% below prime and we are going to port it to our new home. We don't close on the new house until 30 days after this one closes (we are renting it back for the month). My account manager said that, in order to port it, the new house has to close within 90 days of the old one. 

As the pp mentioned, it is hard to get that far below prime these days, so porting it might be a good idea.


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## Maybe Later (Feb 19, 2011)

Thanks for the replies. Our VRM is portable and assumable. The 90 days is helpful. I asked the original Q because one of our options is a new build. In that case, we'll likely not be able to keep the current rate because of the timing, making the below-market rate a possible plus to a buyer. 

I will certainly have to double check any risks to us if the purchaser would default. What is the rationale there?


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## arie (Mar 13, 2011)

*mortgage*

the rational is that you were the one to sign the original mortgage and if the new purchaser takes over your signature is still on that mortgage as they are only taking over your exisiting contract ; basically on default the BAnk can go after either one ie the original mortgagor or the new one

only way is if the bank agrees to release you from the mortgage debt by giving you a release document 

by the way you must also check with the bank if the mortgage is assumable otherwise all this is for nothing


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