What Is Mortgage Portability?

Selling one home and buying another usually means breaking your mortgage — and possibly paying a hefty penalty. Mortgage portability offers a way around that: it lets you carry your existing mortgage, with its current rate and remaining term, over to your new property. Here's how porting works in Canada, when it makes sense, and what to watch for.

Key takeaways

• Portability lets you transfer your existing mortgage rate and term to a new home, avoiding a break penalty.
• It's most valuable when your current rate is lower than today's rates.
• Buying a more expensive home usually means a 'blend and extend' — your old rate blended with a new rate on the extra amount.
• Porting has strict timelines and requires re-qualifying under the lender's rules.
• HOMEH gives eligible buyers the industry's highest Cashback Rebate on your next move. Sellers list for 1%, or free when they also buy with HOMEH within 6 months, or $395 + HST with a Mere Posting.

What is mortgage portability?

Mortgage portability is a feature that lets you take the mortgage you already have — including its interest rate, remaining term, and balance — and apply it to a new home when you move. Instead of discharging your loan and starting fresh, you essentially pick it up and carry it with you.

The big advantage is avoiding a prepayment penalty for breaking your mortgage early. If you locked in a low rate a few years ago, porting can preserve that rate even when current rates are higher. To understand the bigger picture of how your loan works, start with our pillar guide on how mortgages work in Canada.

How porting works when you buy a new home

When you port, your lender re-approves you for the new property — you have to qualify all over again, including the federal mortgage stress test. What happens to your balance depends on the price of the new home.

• Same price (port only) — your existing mortgage moves over largely unchanged.
• More expensive home (port and increase) — you keep your old rate on the original balance and take new money at today's rate on the extra amount. The two are combined into one 'blended' rate.
• Cheaper home (port and decrease) — you may carry forward only part of the balance, and a partial prepayment penalty can apply.

Mind the porting window

Most lenders require you to close the sale of your old home and the purchase of your new one within a set window — often 30 to 120 days. Miss it and you may lose the option to port and owe a break penalty instead. Confirm the exact window with your lender early.

Blend and extend: the most common scenario

Because most people move up to a pricier home, porting usually triggers a 'blend and extend.' Your lender blends your existing rate with the current rate on the new portion, weighted by how much of each you're borrowing. The result sits somewhere between your old rate and today's rate.

Run different price and rate scenarios before you commit using the HOMEH mortgage calculator, and compare with what it would cost to simply break your mortgage in our guide on mortgage penalties.

When portability is worth it

Porting shines when your current rate is meaningfully below today's rates and you want to skip a break penalty. It's also useful if you're buying and selling close together — see our guide on how to buy and sell at the same time.

It may not be worth it if rates have fallen since you signed (you might prefer a fresh, lower rate), if your new home is much cheaper, or if your lender's port terms are restrictive. Not every mortgage is portable — a collateral mortgage, for example, can be harder to move to a new lender.

Moving with HOMEH? Get cashback

Whether you port your mortgage or start fresh, eligible HOMEH buyers receive the industry's highest Cashback Rebate on their move. Sellers list for 1%, or free when they also buy with HOMEH within 6 months, or $395 + HST with a Mere Posting. Estimate yours with the cashback calculator.