Real Estate

Switching from owner occupied loan to rental loan.

  • Last Updated:
  • May 25th, 2021 2:40 am
[OP]
Newbie
Jan 3, 2021
51 posts
40 upvotes

Switching from owner occupied loan to rental loan.

Hi All,

I purchased a condo with a fixed mortgage with a great rate. My question is, if at some point in the 5 years, I want to rent it out, what happens to the 5 year mortgage? I don't mind if they up the rate to whatever the adjusted rental rate is at the time, I just want don't want to have pay the heavy fee for breaking contract.

Do most lenders offer a" blend and extend" option in this scenario? Or have I done myself in, and should have chosen variable :facepalm: ?
2 replies
Deal Addict
Aug 17, 2012
1666 posts
661 upvotes
Windsor
mtlswing wrote: Hi All,

I purchased a condo with a fixed mortgage with a great rate. My question is, if at some point in the 5 years, I want to rent it out, what happens to the 5 year mortgage? I don't mind if they up the rate to whatever the adjusted rental rate is at the time, I just want don't want to have pay the heavy fee for breaking contract.

Do most lenders offer a" blend and extend" option in this scenario? Or have I done myself in, and should have chosen variable :facepalm: ?
Nothing happens just keep paying the installments
Deal Addict
Nov 13, 2013
2891 posts
1601 upvotes
Ottawa
Agree nothing happens. Some have said when you switch insurance (which can be an issue if you don't own another property in Ontario) your lender may be notified but I don't see what they can do anyway. I suppose if rates are 6% at that time banks might be looking for any excuse they can to break agreements but that all seems very unlikely.

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