Is my mortgage broker pulling a fast one? TD lump-sum prepayment question
Buying a $1.415M house, closing in days. Need a sanity check before I sign.
Original plan:
$375k down, mortgage ~$1,040,000 @ 4.06 blended, payment “just under $5k/mo”
What changed at signing:
Broker says the whole approval was actually based on $283k down, not $375k ($92k gap)
His fix: close with a bigger mortgage ($1,132,000), then immediately make a $92k lump-sum payment after funding. Claims this brings my payment back to the original quote.
What my TD contract actually says:
Payment locked at $5,423.17/mo for the term
$92k lump sum is under my prepayment limit — no penalty
But nothing says a lump sum automatically lowers the payment. Default behavior is: payment stays the same, amortization just shortens
When I asked him to confirm in writing, he said:
“Yes correct, you would be able to reduce your payment after making the lump sum, to stretch your payments back out to the contract amortization.”
No actual number given, and “you would be able to” sounds like a manual request to TD, not something automatic.
Questions for the sub:
Is re-amortizing after a lump sum a normal TD process, or is he just hand-waving?
Does this actually land me at the same effective payment as if I’d put the full $375k down originally — or is there a real gap (interest accrued on the extra $92k in the meantime, processing delays, does TD do this automatically or do I need to call in)?
Anyone done this with TD — prepay right after closing, then get re-amortized down? How long did it take?
Trying to decide if I push back and delay closing, or if this is genuinely fine. Thanks!