The prevailing principle is that the satisfaction of the mortgage is cancelled at the outset if the party who executed it has already transferred its interest in the context of that mortgage. This is logical, but nevertheless reassuring when it is pronounced by an appelal court. If you use the same lender as the seller, this should not cause a significant delay. However, if the mortgage is handed over to another lender, especially to a lender that is not as experienced with CEMAs, this could delay the conclusion by a few weeks. However, there is a cost for a CEMA – time and money – so you need to make sure that you save enough to justify the process. Very rude, if the seller`s mortgage is not at least $300,000, it`s not worth it. As a result, your credit estimate shows the full mortgage tax (the amount you would have to pay if you did not do CEMA) in section E, p. 2 of your credit estimate under „Transfer Taxes.“ This section includes mortgage tax as well as other taxes you have to pay, whether you grant a traditional refinancing or CEMA. They should also consider the cost of delays, especially when the mortgage is transferred to a new lender. If you`re on a narrow timeline, it may not be worth running a CEMA, even if it will save you a few thousand dollars. The investigator`s client, a hedging agent, wants to launch a „mortgage tax guarantee“ to ensure that a borrower would pay only mortgage tax on any new loan or debt, even if, for whatever reason (including the existing lender`s refusal to consolidate the loan), the borrower is not eligible for CEMA. From the point of view of the agreement, your CEMA should start the first offer.
If you discover that the seller has a large enough mortgage and is willing to collaborate, you should include the seller`s participation in your offer. If you talk about it after signing the contract, the seller may ask for a significant share of the savings or not cooperate because they want to close quickly. By adding a CEMA to your command (or at least one try), everything is transparent from the beginning. Can a securities agency promote and recommend a product that ensures that a mortgagor who refinances his or her home is not subject to mortgage tax on the full credit balance? Example: Mary owns a $1,000,000 home and owes $200,000 for her mortgage. She wants to access $50,000 of her own equity and get a repayment refinancing, so her new credit balance is 250k. Assuming Mary`s mortgage tax is 2%, she will only pay with a CEMA mortgage tax on 50k (or $1,000 in tax). If it refinances, it will pay mortgage tax on the entire new 250k credit balance (or $5,000 in taxes).