Compliant content provided by Adviceon® Media for educational purposes only.
Mortgage planning cautions
Don’t overburden your cash flow. North Americans are taking on far too much debt, partly influenced by lower borrowing costs. When money is cheap, people take on more debt; when interest rates rise, they reduce debt.
Rates Rates Rates Please do your homework and check our mortgage rates. It is far too easy to take out or renew a mortgage from your local bank that you visit regularly. When you get a mortgage renewal letter from your current lender, work at negotiating a contract or comparing lenders who may have fewer restrictions plus at a competitive rate. A broker or lender may offer much lower rates. A few basis points can make a big difference when it comes to paying off a mortgage.
As a mortgage specialist, I can help. For personalized financial advice, you should speak with a licensed mortgage broker to compare and sell mortgages. He or she will focus on your specific needs, which is just as crucial as a reasonable rate.
Read the fine print. Blessings or potential problems can be ascertained in the details. Know what you’re signing. What are the prepayment options, late payment fees, and refinancing penalties? Is a variable rate mortgage convertible into a fixed rate? If so, how will the lender calculate the fixed rate?
Maximize the frequency of your payments. Consider paying bi-monthly versus monthly to shorten your payment amortization period.
Further, reduce your amortization period. After paying a mortgage for five years, try to reduce the amortization period by those five years. In this way, a 25-year mortgage amortization period is reduced to 20 years.
Know your mortgage facts. It is essential to know the facts about your current mortgage and one that you may renew. Check out what your interest rate is and what your monthly payments are per month. Find out when your mortgage is up for renewal. In certain cases, there may be a penalty for getting out of your mortgage early or restrictions. A change in your rate, such as moving from a variable rate to a fixed rate, might be a good move. Know your total income, liabilities, debt repayment costs and expenses. The lender will then determine how much you can afford. A good rule of thumb is that your mortgage payments should not exceed more than 40% of your net income.
Publisher's Copyright & Legal Use Disclaimer
All articles are a legal copyright of Adviceon®Media.
The particulars contained herein were obtained from sources which we believe
are reliable, but are not guaranteed by us and may be incomplete. This
website is not deemed to be used as a solicitation in a jurisdiction where
this representative is not registered. This content is not intended to
provide specific personalized advice, including, without limitation,
investment, insurance, financial, legal, accounting or tax advice; and any
reference to facts and data provided are from various sources believed to
be reliable, but we cannot guarantee they are complete or accurate; and it
is intended primarily for Canadian residents only, and the information
contained herein is subject to change without notice. References in this
Web site to third party goods or services should not be regarded as an
endorsement, offer or solicitation of these or any goods or services.
Always consult an appropriate professional regarding your particular
circumstances before making any financial decision.
Mutual Funds and/or Segregated Funds Disclaimer
Commissions, trailing commissions, management fees and expenses all may
be associated with mutual fund investment funds, including segregated
fund investments. Please read the fund summary information folder prospectus
before investing. Mutual Funds and/or Segregated Funds may not be
guaranteed, their market value changes daily and past performance is not
indicative of future results. The publisher does not guarantee the
accuracy and will not be held liable in any way for any error, or omission,
or any financial decision. Talk to your advisor before making any financial
decision. A description of the key features of the applicable individual
variable annuity contract or segregated fund is contained in the
Information Folder. Any amount that is allocated to a segregated fund is
invested at the risk of the contract holder and may increase or decrease
in value. Product features are subject to change.