How to Port Your Mortgage, Two Smart Ways to Keep Your Low Rate When You Move
Thinking about moving to a new home but worried about giving up your low mortgage rate? You’re not alone. Many Orange County homeowners want to upgrade, relocate, or get more space, but the idea of jumping from a three percent rate to something in the six percent range feels impossible. The good news is that you may not have to lose your low rate at all.
Porting your mortgage allows you to bring your existing rate with you when you move, and there are two smart ways to do it. In this breakdown, we’ll walk through how Top Up Loans and Blend and Extend options work, using real numbers so you can see exactly how these strategies play out in real life.
It’s Christopher and Broox Mahr with MMG Real Estate Advisors, your local Orange County Realtors sharing strategies most people have never heard about. Now let’s break it down.
A Real World Scenario
Imagine you currently owe five hundred thousand dollars on your home at a three percent interest rate. You find a new home that costs more, and you need an additional two hundred fifty thousand dollars. Today’s mortgage rates are around six point six two five percent. Here’s how porting your mortgage can help you keep your low rate while adding the extra funds you need.
Option 1, Top Up Loan
A Top Up Loan allows you to port your original five hundred thousand dollar mortgage at three percent to your new property. Then you add the extra two hundred fifty thousand dollars at today’s higher rate of six point six two five percent.
You end up with two mortgage portions.
• Five hundred thousand dollars at three percent.
• Two hundred fifty thousand dollars at six point six two five percent.
Your original low rate stays intact, your new funds are added separately, and you avoid paying penalties for breaking your old mortgage. This approach is ideal if you like the idea of keeping your original rate exactly as it is while simply adding what you need for the upgrade.
Option 2, Blend and Extend
Blend and Extend works differently. Instead of managing two separate mortgage portions, your lender blends your old three percent rate with the new six point six two five percent funds. This creates a single, simplified mortgage.
In this scenario, your blended rate ends up around four point two one percent with a total mortgage of seven hundred fifty thousand dollars. You also receive a new extended mortgage term, usually around five years. This option gives you one payment, one rate, and a simplified structure while still taking advantage of your low original rate.
Which Option Is Better?
Both options help you keep your low rate and access the additional funds you need. The right choice depends on whether you prefer two separate portions with your original rate untouched or one blended rate with a single payment. Either way, you avoid the penalties that often come with breaking an existing mortgage and you keep the financial advantage you’ve already earned.
The takeaway
Top Up Loan, keep two separate rates, preserve your existing low rate, and add only the amount needed at the new rate.
Blend and Extend, combine both portions into one blended rate with an extended term and a single payment.
Both options offer smart ways to port your mortgage and move without sacrificing your low interest rate.
If you’re thinking about buying or selling in Orange County, reach out anytime. We’re here to guide you with knowledge and real strategy, not fear.
