What are the conditions for re-borrowing prepaid funds on Sagen-insured mortgages?
Sagen's Mortgage Insurance Prepay and Re-Advance Policy allows borrowers to re-borrow prepaid principal under specific conditions, offering financial flexibility.
Key Points
Think of re-borrowing prepaid funds as a way to access extra cash, not a solution if you're struggling to make payments.
You can only re-borrow up to the amount you've prepaid, and your total mortgage balance can't go above what it would have been if you hadn't made extra payments.
If you take over someone else's insured mortgage, you can't re-borrow any extra payments they made.
A mortgage prepayment is any extra payment you make on your mortgage, beyond your regular scheduled payments. This includes both lump-sum payments and increasing your regular payment amount.
Technical Research Verification
Our systems synchronized 3 data points and regulatory frameworks to verify this technical brief.
Related Questions
How does the stress test differ for fixed vs. variable in 2026?
Both are stress-tested at the higher of the benchmark (5.25%) or the contract rate + 2%.
Why are 3-year fixed rates dominating the 2026 market?
Borrowers are hesitant to lock in for 5 years at current levels, but find 1-2 year rates too expensive.
Fixed vs. Variable Comparison Table
Fixed locks a 5-year rate with IRD penalty risk; variable floats with prime and typically caps break fees at 3 months interest.
What is the 'IRD' penalty risk for 5-year fixed borrowers?
The Interest Rate Differential (IRD) can cost tens of thousands if you break a fixed mortgage when market rates have dropped.