Mortgage Portability

Mortgage portability is a feature in Canadian closed mortgages that allows you to transfer your existing mortgage — including its interest rate and remaining term — from your current property to a new property when you sell and buy simultaneously. This avoids the prepayment penalty that would otherwise apply to breaking a closed mortgage mid-term. Portability is particularly valuable when your existing rate is significantly lower than current market rates. Not all mortgages are portable — always check your mortgage agreement or ask your lender before relying on portability. FCAC's mortgage portability overview.

When you port a mortgage: (1) You sell your existing home and buy a new one simultaneously; (2) Your lender approves the new property as security for the ported mortgage; (3) You re-qualify as a borrower (credit, income, and stress test apply — same as a new application); (4) The ported amount carries the same rate and remaining term as your existing mortgage. The closing dates for your sale and purchase must align closely — typically within 30–90 days depending on the lender's portability window. FCAC's porting guide explains the process.

If your new home costs more than your current mortgage balance, you need additional financing. Two options: (1) Blend and extend: the existing low rate is blended with the current rate on the new amount, and the term is extended. Your blended rate is a weighted average of the two rates. Example: $300,000 at 2.5% (existing) + $200,000 at 5.5% (new) → blended rate ≈ 3.7% on $500,000 for a new 5-year term. (2) Blend to term: same blending but the term matches the existing mortgage's remaining term (not extended). Blend and extend is more common. The exact blend calculation formula varies by lender — always ask for the blended rate in writing before committing.

Most lenders impose conditions: (1) Closing date alignment: both sale and purchase must close within the lender's portability window — typically 30–90 days (some lenders allow up to 120 days with interim bridge financing). (2) Re-qualification: you must re-qualify for the ported mortgage based on current income, credit, and the stress test — even if the rate is not changing. (3) Property approval: the new property must meet the lender's underwriting criteria (type, location, condition). (4) Collateral charge restriction: collateral charge mortgages (e.g., TD) are typically not portable — they must be discharged and re-registered. See mortgage discharge.

Porting preserves your rate but locks you into your current lender and term structure. Breaking may be better when: (1) Your existing rate is close to the current market rate — the penalty cost is less than the blending compromise; (2) You want more flexibility on the new property (different lender, different term, larger principal changes); (3) The blended rate offered by porting is not significantly better than a fresh rate; (4) The portability window is too tight for your closing schedule. Calculate the penalty cost vs the interest savings over the remaining term at the blended rate vs a new rate. On a 3.5% mortgage in a 5.5% market with 2 years remaining, porting saves approximately $8,000–$15,000 on a $400,000 balance — usually worth the effort of meeting portability conditions.

Generally yes — most national lenders (Big Six banks, monolines) allow portability to any province. However, there are exceptions: some credit unions or regional lenders may restrict portability to their operating province. Additionally, Quebec has different property registration requirements (civil law notarial system vs common law title system in other provinces) which can complicate cross-provincial port transactions. Always confirm with your lender that portability is available to your destination province before committing to your sale and purchase timeline. FCAC's mortgage guides cover provincial variations.