If you have a closed-term mortgage and you decide to sell your home1 before the end of the term, prepaying your mortgage loan may trigger a mortgage penalty.
National Bank can reimburse all or part of your mortgage penalty if you make use of one of the following strategies:
A roll-over mortgage involves transferring the terms and conditions of your existing mortgage loan (balance, interest rate and residual term) to a new mortgage loan taken out at National Bank for the purchase of another home. This transaction will enable you to recover all or part of your mortgage penalty when the new mortgage loan is disbursed.
If the amount of the new mortgage loan is higher than the amount of the existing mortgage loan, you can also take advantage of the Multi-Choice option. The Multi-Choice option enables you to split your new mortgage loan into two portions:
To take advantage of this solution, you must obtain a new mortgage loan within 90 days of the date you close your existing mortgage loan.
If the amount of the new mortgage is less than the balance of the existing mortgage loan and/or its rate and remaining term are less than those of the existing mortgage loan, a penalty may be charged.
In certain cases, you may not be required to pay a mortgage penalty if the Bank grants the buyer of your home a mortgage loan with an amount, rate and term equal to or greater than those of your existing mortgage loan. The buyer’s mortgage financing must be granted within 90 days of your mortgage loan being closed.
Buying a bigger home? There is one more option available to you.
If you or your buyer obtain a closed mortgage loan for an amount equivalent to at least twice the balance of your existing mortgage loan, the mortgage penalty triggered by prepayment of your closed-term loan may be reimbursed. The new financing must be obtained within 90 days of prepayment of your original mortgage loan.
1The strategies set out in this text are conditional on the approval of new mortgage financing within 90 days of prepayment of the original mortgage loan. All these strategies apply only to new mortgage financing. All other types of financing are excluded (All-In-One, personal Line of Credit, personal loan, etc.). Other conditions may apply.