Porting a Mortgage - What about the CMHC?

[bizaro86]

Hello,

I recently bought another condo in Calgary, which I am currently fixing up. My plan is to rent it out for positive cash flow, but I could also sell it, and take the cash to buy more property.

My question is this: If I sell the condo, and port the mortgage to a newly purchased condo, what happens to the CMHC insurance fee I paid on the first property? Can I get some sort of credit towards the CMHC fees on the second property?

Michael

 

[RobMacdonald]

You actually will not have to pay additional cmhc fees on the new property unless you are increasing the mortgage. If the mortgage amount is going up, then you will have to insure the new funds at 4.5%. So it won`t be that expensive. And the new premium can be rolled into the new mortgage amount.

 

[Thomas Beyer]

QUOTE (bizaro86 @ Oct 23 2009, 07:35 AM) ..
My question is this: If I sell the condo, and port the mortgage to a newly purchased condo, what happens to the CMHC insurance fee I paid on the first property? ..
IF (!!) bank and CMHC allows porting you pay a nominal admin fee ..

You can usually also increase the mortgage if the 2nd property is far more valuable and you get a credit for a mortgage increase ..

Details here: http://www.cmhc-schl.gc.ca/en/co/moloin/moloin_005.cfm

 

[bizaro86]

Thank you both for the information. I`ll have to talk to my broker about the specifics of this situation, but it seems like it could work. Now I just have to decide if I actually want to sell the condo, or if I should keep it. It will positive cash flow the way it is mortgaged now, but if I sell it I could free up the sweat equity we put into fixing it up, and use that to buy more properties. Decisions, decisions.

Michael

 

[Thomas Beyer]

QUOTE (bizaro86 @ Oct 27 2009, 07:22 PM) ... Now I just have to decide if I actually want to sell the condo, or if I should keep it. It will positive cash flow the way it is mortgaged now, but if I sell it I could free up the sweat equity we put into fixing it up, and use that to buy more properties. Decisions, decisions.
indeed .. we always have the most heated debates about "when to sell" or "at what price to sell" .. as anything you sell today, on average, will be more valuable tomorrow !

At the recent Calgary Real Estate forum on Oct. 21 2009 in the apartment building session with about 150 attendees when asked "who wants to buy right now ?" almost everyone raised their hand .. and when asked "who is selling right now" .. almost no one raised their hand !