# Can a mortgage be assumed by a new borrower, and what happens to the existing mortgage insurance coverage?

> A lender is not required to notify Sagen of an assumption provided the loan is in good standing, the terms remain unchanged, all supporting documentation is retained and the new or remaining covenant(s) are of the same or higher quality to those originally insured by Sagen .

Category: Strategy
Last verified: 2026-02-18
Source: https://ratellow.com/faqs/strategy/can-a-mortgage-be-assumed-by-a-new-borrower-and-what-happens-to-the-existing-mortgage-insurance-coverage

## Answer
A lender is not required to notify Sagen of an assumption provided the loan is in good standing, the terms remain unchanged, all supporting documentation is retained and the new or remaining covenant(s) are of the same or higher quality to those originally insured by Sagen .

## Institutional highlights
- Someone else can take over your mortgage if you've made all your payments on time for the past year.
- When someone assumes your mortgage, the original interest rate and terms stay the same.
- The person taking over your mortgage needs to be as creditworthy as you were when you got the mortgage.
- Your lender will check to make sure the new borrower qualifies for the mortgage based on their own rules.

## Related guide
- https://ratellow.com/guides/mortgage-prepayment-privileges

## Sources
- Mortgage Insurance Prepay and Re-Advance Policy — https://www.sagen.ca/ups/underwriting-documentation/#mortgage-insurance-prepay-and-re-advance-policy-638f55989d20b
- I. Purpose and scope of the guideline — https://www.osfi-bsif.gc.ca/en/guidance/guidance-library/residential-mortgage-underwriting-practices-procedures-guideline-2017#1.0
- Page 2 — https://assets.cmhc-schl.gc.ca/sf/project/cmhc/pdfs/factsheets/new/cmhc-quick-reference.pdf#page=2
- Notes — https://www.bankofcanada.ca/rates/banking-and-financial-statistics/posted-interest-rates-offered-by-chartered-banks/#notes