Real Estate

need to renew mortgage when house in the market for sell

  • Last Updated:
  • Mar 10th, 2020 9:39 am
[OP]
Newbie
Jan 26, 2019
26 posts
29 upvotes

need to renew mortgage when house in the market for sell

as the title, my house is currently in the market for sell and mortgage will be expired on May.
I am in Lower Mainland, BC, the market is just picking up, not as hot as ON yet, so wouldn't expect it will be sold in one or two months.
Just wondering what kind of mortgage I should take to minimize the penalty for closing(discharging) mortgage when the house is sold in the near future.
and should I let the bank know my house is on market when negotiating mortgage rate?
any advices are appreciated...
2 replies
Deal Addict
User avatar
Jan 2, 2012
3919 posts
1776 upvotes
Toronto
mortgageseeker wrote: as the title, my house is currently in the market for sell and mortgage will be expired on May.
I am in Lower Mainland, BC, the market is just picking up, not as hot as ON yet, so wouldn't expect it will be sold in one or two months.
Just wondering what kind of mortgage I should take to minimize the penalty for closing(discharging) mortgage when the house is sold in the near future.
and should I let the bank know my house is on market when negotiating mortgage rate?
any advices are appreciated...
What are you doing after you sell the home, won't you need a new home with a new mortgage? If so then you can get the usual fixed-term mortgage on your current home and then "port" it over to your new home when the time comes. Just make sure to check with your lender on their policies for porting.

If you are not requiring a new mortgage after you sell, then you should ensure to get an open mortgage which can be closed out at any time with no penalty. You will always pay a discharge fee though (I think around $400) no matter what when you want to close out lender and remove the lien from your home.
Deal Fanatic
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Feb 2, 2014
8329 posts
2334 upvotes
Toronto
rob444 wrote: What are you doing after you sell the home, won't you need a new home with a new mortgage? If so then you can get the usual fixed-term mortgage on your current home and then "port" it over to your new home when the time comes. Just make sure to check with your lender on their policies for porting.

If you are not requiring a new mortgage after you sell, then you should ensure to get an open mortgage which can be closed out at any time with no penalty. You will always pay a discharge fee though (I think around $400) no matter what when you want to close out lender and remove the lien from your home.
I would recommend going OPEN over fixed tbh.

You can have issues porting...it's sort of risky. Perhaps he closes on the sale and doesn't close on a purchase months later (too big of a gap to port). Also, I've heard of the Big 5 denying ports for no apparent reason (anecdotally evidence, I know).

I think open is the way to go if he's current has his house listed for sale and a sale is imminent.
Kevin Somnauth, CFA
Principal Broker - First Toronto Mortgage - MA (Ontario #13176, BC #X301007)
Real Estate Salesperson - Century 21 Innovative

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