A two-column worksheet for deciding whether to port an Ontario mortgage to a new home or pay the penalty and start again.
⚖️ This is general information, not legal advice. It can't account for your specific situation. Use it to get oriented, then confirm the details with a licensed Ontario lawyer.
When you sell one home and buy another, your mortgage either comes with you or it ends. Porting keeps the rate, term and balance and avoids the penalty; breaking pays the penalty and lets you start fresh with any lender. Neither is right in general. This worksheet sets out what to find in your documents, the questions to put to the lender, the two columns to fill in, and the legal steps that follow each choice. It explains the mechanics and the law; it does not recommend a lender or a product.
Before you start: three facts from your documents
- Whether your mortgage is portable at all. It is in the standard charge terms, and some products, especially promotional rates and some collateral charges, cannot be ported.
- The porting window: how many days between the sale closing and the purchase closing the lender allows, and whether the penalty is waived within it or charged and refunded.
- The penalty method: three months' interest, or the greater of that and the interest rate differential. This decides how much you are avoiding by porting.
Questions for the lender
- Will you approve me and the new property for a port? Porting is not automatic; the lender underwrites both again.
- If I need more money, what rate applies to the new money and how do you blend it with my existing rate? Over what term?
- If I need less money, is there a penalty on the part I am paying down, and can I use my prepayment privilege first?
- If my purchase closes after my sale, is the penalty charged and refunded, or not charged at all, and what is the deadline?
- If the mortgage is insured, does the insurance port too, and what are the insurer's rules for an increase?
Column A: port
- Existing balance at existing rate for the remaining term.
- New money, if any, at the lender's rate for the new money, blended as the lender describes.
- Costs: appraisal on the new home, legal costs on the discharge and the new charge, any port fee.
- Deferred penalty risk: if the purchase misses the window, the penalty applies after all. Write the amount beside the deadline.
Column B: break
- Penalty from the payout statement, plus the old lender's discharge fee.
- New mortgage for the full amount at today's rate, with any lender, for whatever term suits the new home.
- Costs: appraisal, legal costs on the new charge, and whatever the new lender charges or covers.
- Flexibility gained: a different product, a different penalty method, a different lender.
Comparing the columns
Compare the total cost of each column over the same number of months, usually the months left on your current term. The penalty estimator on this site gives the penalty; the mortgage payment calculator gives the interest under each rate. If Column A is clearly cheaper and the dates fit the window, port. If today's rates are lower than yours, Column B often wins even after the penalty. If the columns are close, the non-financial reasons decide: whether you want a different lender, whether the blended term suits the new home, and how much risk of missing the window you are willing to carry.
Remember the rule that overrides the contract. If your term is longer than five years and five have passed, section 10 of the Interest Act limits the penalty for an individual borrower to three months' interest, which changes Column B.
The legal steps if you port
- Tell your lawyer both closing dates early. The discharge on the sale and the new charge on the purchase must line up with the lender's porting paperwork.
- The old charge is discharged on the sale; the new charge is registered on the purchase; the contract continues.
- If there is a gap, the penalty may be charged on the sale and refunded after the purchase. Get the refund terms in writing and diarise the deadline.
- Spousal consent under section 21 of the Family Law Act applies to the new charge if the new home is a matrimonial home.
The legal steps if you break
- Ask for a payout statement early. It carries a per-diem and a date; the sale closing must fit.
- The old mortgage is paid out from trust on the sale and the discharge registered. Check the parcel register afterwards.
- The new lender instructs a lawyer on the purchase as for any new mortgage: title search, identity verification, consents, registration and funding.
How Treadstone Law can help
Porting and breaking are both ordinary. What goes wrong is deciding late, missing the window, or comparing a rate with a penalty instead of one total cost with another. Fill in both columns first.
Treadstone Law handles real estate matters on a transparent flat fee, with online intake and a real lawyer on your file, across Ontario.
- Start your file online at treadstonelaw.ca/start-file
- See flat-fee pricing at treadstonelaw.ca/pricing
- Learn more about our real estate services at treadstonelaw.ca/real-estate
- Or call us: 1-844-900-1070
This is not legal advice
This guide is general information, not legal advice. Reading it does not create a lawyer-client relationship. Ontario laws and government programs change, and how the law applies depends on your specific facts. For advice about your situation, speak with a licensed Ontario lawyer. Treadstone Law is licensed by the Law Society of Ontario — reach us at 1-844-900-1070 or start a file online.