This Scotia Bank Poll Found out that 1/3 of Canadians believe they will still have their mortgage once they retire.
That will be a huge portion of their retirement income spent on a mortgage.
Read poll below:
That will be a huge portion of their retirement income spent on a mortgage.
Read poll below:
Snapshot: Canadian mindset on mortgages
Some Canadians with mortgages think they might carry them into retirement
HOW TO PAY OFF MORTGAGE FASTER
--- The easiest way is to make accelerated biweekly payments-- there is only a few dollars difference but it will make a difference in years.
This Chart shows you how much you can save
Example: monthly vs. accelerated biweeklyJohn is trying to decide between paying his mortgage monthly and paying accelerated biweekly.
Details
With the accelerated biweekly payments, John will pay off his mortgage 3.7 years faster and save more than $21,000 in interest.
---Make Use of Your Prepayment Options: Monthly and or yearly
Mortgage prepayment options outline the flexibility you have to increase your monthly or lump sum yearly mortgage payments without penalty. The monthly prepayment provision is a percentage increase allowance on your original monthly mortgage payment, while the lump sum provision allows you to put money towards your mortgage principal. According to the Canadian Association of Accredited Mortgage Professionals (CAAMP), 28% of Canadians took advantage of prepayment privileges in 2010.
Many lenders have 15/15 or 20/20 prepayment allowances usually on the original amount of the mortgage and they will accept as little as $100.00 per each prepayment. So you do not have to save a lot to take advantage of the prepayment programs.
----Keep Tabs of Current Interest Rates
Sometimes even with a penalty it makes sense to break your mortgage and go with a lower rate.
By setting some more money aside for extra mortgage payments, it can shave years off of your mortgage, and will let you retire without a mortgage payment, a winning combination.
Time for a mortgage Checkup?
Call me and I will check your mortgage and let you know what you can do to shorten your mortgage thereby saving you money and years off your mortgage.
This is a free service.
TORONTO, Nov. 5, 2012 /CNW/ - According to a recent Scotia bank poll, the role of the Canadian home is key, with the majority of Canadians (77 per cent) indicating their home is an investment rather than an expense. The investment may extend beyond retirement for some; among those mortgage holders not yet retired, one-third (32 per cent) say they will likely still have their mortgage when they retire. That said, Canadians are eager to leave their mortgages behind, with almost three-quarters (72 per cent) of Canadian mortgage holders taking at least one step to becoming mortgage-free faster. When it comes to mortgage-mindset - Canadians are thinking in the right direction:
- Two-thirds (69 per cent) of Canadians report owning a home. For Canadian home owners, 40 per cent are living mortgage-free.
- The majority (81 per cent) of Canadians agree it is important to become mortgage-free as soon as possible.
- The most common step Canadians are taking to pay off their mortgage faster is to increase the frequency of their regular payments (29 per cent).
- One-third of Canadians (34 per cent) say they will be relying on their home equity to support them in retirement.
HOW TO PAY OFF MORTGAGE FASTER
--- The easiest way is to make accelerated biweekly payments-- there is only a few dollars difference but it will make a difference in years.
This Chart shows you how much you can save
Example: monthly vs. accelerated biweeklyJohn is trying to decide between paying his mortgage monthly and paying accelerated biweekly.
Details
- mortgage principal: $150,000
- amortization: 25 years
- interest rate: 5.45% for the entire mortgage amortization period.
Monthly
|
Accelerated biweekly
| |
|---|---|---|
| Number of payments per year |
12
|
26
(52 weeks a year ÷ 2) |
| Payment |
$911
|
$456
|
| Total payments per year (principal and interest) |
$10,932
|
$11,856
|
| Principal paid over the amortization period |
$150,000
|
$150,000
|
| Interest paid over the amortization period |
$123,368
|
$102,113
|
| Interest saved |
-
|
$21,255
|
| Number of years to repay the mortgage |
25.0
|
21.3
|
| Years saved |
-
|
3.7
|
---Make Use of Your Prepayment Options: Monthly and or yearly
Mortgage prepayment options outline the flexibility you have to increase your monthly or lump sum yearly mortgage payments without penalty. The monthly prepayment provision is a percentage increase allowance on your original monthly mortgage payment, while the lump sum provision allows you to put money towards your mortgage principal. According to the Canadian Association of Accredited Mortgage Professionals (CAAMP), 28% of Canadians took advantage of prepayment privileges in 2010.
Many lenders have 15/15 or 20/20 prepayment allowances usually on the original amount of the mortgage and they will accept as little as $100.00 per each prepayment. So you do not have to save a lot to take advantage of the prepayment programs.
----Keep Tabs of Current Interest Rates
Sometimes even with a penalty it makes sense to break your mortgage and go with a lower rate.
By setting some more money aside for extra mortgage payments, it can shave years off of your mortgage, and will let you retire without a mortgage payment, a winning combination.
Time for a mortgage Checkup?
Call me and I will check your mortgage and let you know what you can do to shorten your mortgage thereby saving you money and years off your mortgage.
This is a free service.
Angela Kroemer, AMP
Mortgage Professional
TMG The Mortgage Group Canada Inc.
TMG Sharie Marie Mortgage Team
Local: 1.250.650.4182
TFP: 1.888.679.0190
Fax: 1.888.679.0192
Mortgage rates are varying regularly as compare to other interest rates. Pay attention to trends and keep in mind those present mortgage rates changes frequently. Instead of trying to pinpoint a day when the mortgage rate is at its lowest, ensure how the rates vary from one day to the next.
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Good Information. Thanks
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