What is meant by "portability" in mortgage terms?

In mortgage terms, "portability" refers to the ability to transfer an existing mortgage from one property to another. This feature is advantageous for homeowners who wish to move to a new home without incurring additional costs or penalties associated with breaking their current mortgage. When a mortgage is portable, the borrower can take their existing mortgage contract, including its interest rate and terms, and apply it to the new property they are purchasing. This can be particularly beneficial if the mortgage rate is lower than current market rates, allowing the borrower to retain favorable borrowing conditions despite changing properties.

The other options relate to different aspects of mortgage management but do not accurately describe "portability." The ability to switch lenders without penalties pertains more to refinancing rather than transferring a mortgage. Reducing the mortgage interest rate typically involves refinancing or renegotiating terms with the lender. Increasing mortgage amounts on new purchases also refers to adjusting a loan for new funding needs, which is distinct from the concept of portability.