The U.S. housing market is facing a paradox. Millions of homeowners would like to move — to upsize, downsize, or relocate — yet many feel stuck. The reason: they don’t want to give up the historically low mortgage rate they locked in years ago. As policymakers and industry leaders search for ways to ease the pressure, one idea has entered the conversation: mortgage portability. Mortgage portability would allow homeowners to carry their existing mortgage and interest rate to a new home. But would a portable mortgage product actually help fix the U.S. housing crisis? To explore that question, we spoke with Rey Reyes, director of sales, CEO, and senior mortgage loan officer at WeLoan. Reyes has more than 15 years of lending experience and ranks among the top loan officers in California and nationwide.
One of the biggest forces shaping today’s housing market is the rate lock-in effect. Homeowners who secured mortgage rates in the 2%, 3%, and 4% range during the pandemic are reluctant to sell when current rates are significantly higher. Reyes sees this dynamic play out daily. “You see it all the time where there are people who want to move, and they want to sell,” he says. “But they have a 2% rate, 2.5% rate, and new rates are three times that. They’re not really wanting to make that switch.” Instead of moving, many homeowners choose to stay put, renovate, or adapt their existing home, even when it no longer fits their needs. That reluctance to sell reduces the number of homes available, contributing to tighter inventory and upward pressure on prices. This is the backdrop against which mortgage portability is being discussed. At its core, mortgage portability is meant to address payment shock — the sudden jump in monthly housing costs that occurs when a homeowner replaces a low-rate mortgage with a much higher one. Reyes views portability as a logical response to that problem. “Mortgage portability is a good concept, because it means that you’re locked in a good rate and you get to take that with you,” he explains. By allowing homeowners to keep their existing rate, portability could reduce what many borrowers perceive as a financial penalty associated with moving. That, in theory, makes it easier for people to sell and buy again without resetting their mortgage entirely. But Reyes is careful to frame portability as a targeted solution, not a universal fix. “What I think it would help solve is that it could increase the housing turnover,” he says. “Especially for families, people who maybe bought something small and they’re trying to upgrade, or reduce the payment shock for existing borrowers.” It’s important to note that portable mortgages are not currently available in the United States. If U.S. homeowners could keep their low-rate mortgages when moving, Reyes believes market activity would increase. “There would be more activity, definitely, in the market because now they’re not locked into their house,” he says. “They’re just locked into their mortgage, so that would bring in more listings, and people would be able to move more freely.” Reyes expects portability could encourage: All of that could translate into more buyers and sellers, especially in markets where homeowners are sitting on large amounts of equity.What’s driving the current U.S. housing gridlock
What mortgage portability is designed to solve
How mortgage portability could increase housing turnover
