Short answer
The assignee must qualify with a lender willing to finance the final builder closing and understand the assignment structure. The lender may review the original purchase price, assignment consideration, deposits, builder documents, current appraised value and the source of every dollar. A pre-approval before locating the unit is not final approval.
The client problem behind the question
The assignee thinks the mortgage will be based automatically on the higher assignment price. At appraisal, comparable units support less. The lender recognizes only certain costs or equity, and the assignee must produce more cash than expected.
A practical Ontario example
Illustration only: An original buyer contracted at $650,000 and assigns at $720,000 after paying $100,000 in deposits. The appraisal supports $680,000. The lender decides its loan using its own eligible value and policy, not the parties’ hoped-for number. Rajiv recalculates cash, verifies how the reimbursed deposit is documented and compares lenders before conditions are waived.
Questions Rajiv would ask before suggesting a route
- Which price and value will this lender use?
- How will the original deposit and assignment consideration be documented?
- Has the lender reviewed the full builder agreement and assignment agreement?
- Are HST and closing adjustments included in the cash plan?
- What remains conditional and when does the rate hold expire?
Practical routes to compare
- Start with an A lender when income, credit, property and value fit.
- Compare alternative lenders where income or property needs a broader policy.
- Use MIC or private financing only when the total cost and written exit make sense.
- Keep financing and legal conditions until the relevant professionals have reviewed the complete documents.
Keep the decisions separate
- Contract and liability: the builder agreement, assignment documents and written consent are for the real-estate lawyer to interpret.
- Marketing and price: a Realtor can assess comparable choices and work within builder restrictions.
- Mortgage: the lender decides acceptable value, income, credit, documents and funding structure. A regulator does not set that lender policy.
- Tax: an accountant or tax lawyer should confirm GST/HST, rebate and income-tax treatment from the actual facts.
Where A, alternative, MIC and private lending may fit
An A lender is normally the first route when income, credit, debt ratios, property and current value fit. Alternative lenders can take a broader view of income or property at a higher cost. A MIC is an institutional mortgage lender and may offer a six-to-twelve-month or longer term, interest-only or amortized payments, open or partially open features, and sometimes a maturity matched to the planned exit. A private lender may also bridge a closing. A short-term approval is useful only when the client can explain how it will be repaid through refinance, sale or other documented funds.
Verified fact and current limitation
Mortgage valuation and eligible equity are lender policies. The assignment contract cannot force a lender or mortgage insurer to accept the assignment price, deposit treatment or appraisal value.
Source checked 2026-09-03: read the primary source. Builder wording, lender policy, taxes, appraisal and market conditions must still be verified for the file.
Pressure-test the answer
The route can fail if consent is refused, marketing is restricted, the assignee cannot finance, the appraisal is low, payment timing is unclear, tax is larger than expected, documents expire or the assignor remains liable. Keep a closing fallback, calculate the worst cash requirement and involve the lawyer before a contractual deadline is missed.
Documents to gather now
- Original purchase agreement, disclosure statement, amendments and assignment clause
- Builder consent requirements, fee schedule and critical dates
- Deposit receipts, upgrade payments and 90-day source-of-funds history
- Proposed assignment agreement and payment schedule
- Current income, credit, liabilities and other-property details
- Comparable sales, appraisal and lawyer/accountant estimates when available
Related AskRajiv guidance
Continue with pre construction appraisal shortfall closing options, conditional mortgage approval conditions before closing.
Get an assignment closing strategy
Use Rajiv’s direct mortgage strategy form. Include the builder deadline and the result you need: assign, close, rent, sell or arrange a short-term bridge.
Source and review
Reviewed by Rajiv Verma, Mortgage Broker on 2026-09-03. Educational information only; not legal, tax, appraisal, real-estate or mortgage approval advice.