TRANSFERS & SWITCHES

Transferring or switching your mortgage can save you thousands in interest — but only if you understand the rules, penalties, and timing. Most homeowners miss opportunities because they assume switching is complicated or expensive, when in reality the right lender can make the process smooth and cost-effective.

See why switching at the right time can lower your rate and protect your renewal strategy 👇

1️⃣ WHAT A TRANSFER/SWITCH ACTUALLY IS

A transfer (also called a switch) moves your existing mortgage — same balance, same remaining term — to a new lender offering a better rate. You cannot add new money beyond the typical $3,000 lenders allow for legal/admin/appraisal costs. More than that becomes a refinance.

2️⃣ WHEN YOU CAN TRANSFER WITH NO PENALTY

If your mortgage is at **renewal**, you can switch lenders penalty-free. You will still need to re-qualify, but many lenders will cover or roll in legal and appraisal costs. This is the best time to shop around instead of blindly signing your renewal letter.

3️⃣ SWITCHING MID-TERM TO GET A LOWER RATE

You *can* switch in the middle of your term — but a penalty will apply. This usually only makes sense when the new rate savings outweigh the penalty. A broker calculates whether the math works before you make a move.

4️⃣ WHY USING A BROKER MATTERS

A broker shops:

• Big banks

• Credit unions

• Monoline lenders

• Alternative lenders

• Private lenders

This ensures you get the best overall cost of borrowing, not just the lowest rate. You never have to negotiate or call lenders — the broker handles everything.

5️⃣ DOCUMENTS YOU’LL NEED

A switch still requires updated documents:

• Income verification

• Credit check

• Property details

• Current mortgage statement

Think of it like qualifying again, but easier than a full refinance.

6️⃣ WHAT COSTS TO EXPECT

Depending on timing, you may see:

• Legal fees

• Appraisal fees

• Lender admin fees

• Penalty (only if switching mid-term)

Many lenders allow up to $3,000 to be included in the new mortgage to offset these costs.

7️⃣ DO YOU NEED TO PASS THE STRESS TEST?

Yes — **unless** your mortgage was originally funded prior to **Nov 30, 2016**.

If so, you are “grandfathered” under previous rules and qualify at the contract rate, not the stress-test rate. This can make a huge difference in approvals.

8️⃣ UNDERSTANDING YOUR PENALTY BEFORE MOVING

Fixed-rate penalties can vary wildly between lenders (especially big banks). Before switching mid-term, a broker calculates:

• The exact penalty

• The break-even point

• The real savings

This prevents expensive surprises and ensures switching makes financial sense.

💬 Final Thought

A transfer or switch can reduce your rate, lower your payment, and improve your mortgage flexibility — but only if the numbers and timing line up properly. Before renewing or switching mid-term, let us run the analysis for you so you can make the smartest financial move.

Message The Frontline Mortgage Group anytime for a free review of your mortgage.