The client
A family moving to a $385,000 home in Bathurst, New Brunswick, right at the maturity of their existing $245,000 insured mortgage. Combined income $8,300/month, adding $20,000 cash to the move.
Borrowers
Combined income $8,300/month
Both salaried
New purchase
$385,000, Bathurst
At maturity of the existing insured mortgage
Ported balance
$245,000 existing insured mortgage
Being carried forward to the new home
Cash added
$20,000
Toward the new purchase, beyond the ported balance
Other debt
$320/mo
Other monthly debt payment
The problem
Porting an existing insured mortgage to a new property carries the existing balance forward without repeating the default insurance premium already paid on it. Any increase needed for the new, pricier home gets a top-up premium instead — and it's priced at a different, higher rate than the standard schedule.
The assumption the family started with
- ▸Assumed: since they were moving at maturity anyway, porting the existing mortgage "probably didn't matter" compared to just starting fresh
- ▸The increase needed to buy the new home: $120,000, on top of the $245,000 ported balance
- ▸Nobody had actually priced what that increase would cost under porting versus under a brand-new insured mortgage
Sagen's own published rate card shows a separate top-up premium column, in the 5.90%–6.30% range, specifically for portability and increase scenarios — a higher rate than the standard 0.60%–4.00% schedule. On its own, that sounds like porting the increase should cost more, not less. The dollar math tells a different story.
The numbers
The top-up rate is higher, but it only applies to the $120,000 increase — not to the whole new mortgage. A fresh new insured mortgage pays the lower standard rate, but on the entire amount, a comparison worth pricing every time a move lands near a maturity date, as Canadian mortgage renewal statistics suggest happens often.
| Porting and topping up | Amount |
|---|---|
| New purchase price | $385,000 |
| Cash toward the purchase | $20,000 |
| Ported existing insured balance | $245,000 |
| Increase needed | $120,000 |
| Top-up premium on the increase (5.90%-6.30% range; 6.05% used here) | $7,260 |
| Total mortgage, ported and topped up | $372,260 |
The fresh alternative, priced for comparison
| Discharging and originating fresh | Figure |
|---|---|
| Base mortgage needed (price less cash down) | $365,000 |
| Loan-to-value band | 94.8% → 4.00% premium rate |
| Standard premium on the full $365,000 | $14,600 |
| Total mortgage, fresh | $379,600 |
$379,600 fresh versus $372,260 ported — a $7,340 difference in premium alone, because the top-up rate applies only to the $120,000 increase, while the standard rate on a fresh mortgage applies to the entire $365,000.
Ratios on the ported mortgage
| Ratio | On the $372,260 ported mortgage |
|---|---|
| Minimum qualifying rate (greater of contract + 2% or 5.25%) | 7.10% |
| Qualifying payment, 25 years | $2,630/mo |
| GDS (payment + $310 tax + $140 heat) ÷ $8,300 income | 37.1% |
| TDS (GDS numerator + $320 other debt) ÷ income | 41.0% |
The solution
A New Brunswick mortgage broker priced both structures against the exact same purchase before recommending either one.
First, confirmed the ported balance and the increase needed — $245,000 carried forward, $120,000 new money required to complete the $385,000 purchase after the family's $20,000 cash contribution.
Second, priced the top-up premium on just the increase, using Sagen's published portability range, against the standard-schedule premium a fresh new insured mortgage would owe on the entire base amount.
Third, showed the family the actual dollar gap — $7,340 in premium — rather than relying on the conventional wisdom that porting is "usually" the cheaper move without ever pricing it for this specific file.
The outcome
The ported, topped-up mortgage funded at $372,260, $7,340 less premium than a fresh new insured mortgage on the same purchase would have cost. Qualifying payment $2,630/mo, GDS 37.1%, TDS 41.0%.
| Cash due at closing (beyond the $20,000 down payment) | Amount |
|---|---|
| New Brunswick's flat 1% real property transfer tax on $385,000 | $3,850 |
| Legal fees and adjustments | varies |
The $7,340 saved in premium was rolled into the mortgage either way, since porting and topping up were both cheaper than starting fresh — the saving showed up as a smaller total mortgage, not as cash in hand.
What to take from this file
- 01A higher rate on a smaller base can still cost less than a lower rate on the whole amount. The top-up premium applies only to the increase, not the entire new mortgage.
- 02"Porting is usually cheaper" is a real, computable fact here, not just conventional wisdom. Pricing both options for the specific file is what turns the assumption into a number.
- 03Moving at maturity doesn't make porting irrelevant. The premium math applies whether or not the move happens to line up with a renewal date.
- 04Get the current top-up rate from the insurer for the specific file. Sagen publishes a range, not a single figure, and the exact rate depends on the file.
- 05A land transfer tax still applies to the new purchase, separately from the premium comparison. Porting the mortgage doesn't port the tax.
Sources
Every regulatory figure in this file traces to one of these primary sources. Client details and anything that varies by lender are illustrative, as flagged below.
- ▸OSFI — Minimum qualifying rate for uninsured mortgages — the minimum qualifying rate — greater of contract rate + 2% or 5.25%.
- ▸CMHC — Purchase (Mortgage Loan Insurance) — default-insurance premium schedule by LTV band (25-year amortization).
- ▸Sagen — Premium Rates Chart — Sagen's standard premium schedule, matching CMHC's bands.
- ▸CMHC — CMHC Home Start — minimum down payment tiers (5%/10%) and the $1.5M insured price cap.
- ▸Real Property Transfer Tax Act, S.N.B. (via laws.gnb.ca) — New Brunswick's flat 1% real property transfer tax.
- ▸Provincial/territorial mortgage-broker legislation fetched directly (bclaws.gov.bc.ca, legisquebec.gouv.qc.ca, fcaa.gov.sk.ca, web2.gov.mb.ca, nslegislature.ca, assembly.nl.ca) plus FCNB's own site for NB and CanLII's index for PE — see notes for per-province method — provincial mortgage regulators and licence titles.
Illustrative in this file — lender-specific, not rules:
- ▸6.05% top-up premium rate — Sagen publishes a 5.90%-6.30% range for portability/increase scenarios; the exact rate within that range depends on the file and was not published to the cent.
- ▸5.10% new-money rate — rates move daily; not a quote.
Authority & provenance
How this case file was built
We publish the origin, the verification method and the reviewer for every case file, so you can judge how far to trust it before you rely on it with a client.
Where it comes from
Derived from files handled by Treadstone’s fulfillment desk and from scenarios contributed by partner brokerages. Names, employers, exact amounts and dates are changed so no client or file is identifiable.
Provenance: Composite — a pattern seen repeatedly on fulfilled files, not a single transaction.
What is verified
Every regulatory figure traces to a primary source listed above and was checked against it on the date shown. The arithmetic is recomputed by machine on every rebuild.
Anything that varies by lender is labelled illustrative rather than stated as a rule.
Who reviewed it
Reviewed for Canadian regulatory accuracy before publication, and re-checked whenever a cited rule changes.
Reviewed by: Nicholas Parson, Treadstone Associates — reviews every case file before publication.
This case file is professional reference material for licensed mortgage professionals. It is not advice to a borrower, and it is not a lender commitment. Insurer rules, qualifying rates and provincial taxes change — confirm the current position with the insurer, regulator or lender before you rely on any figure here in a live file.