Thank you for visiting www.GreatMortgageAdvice.com By Cecilia Ramos
Mortgages in Canada are generally amortized between 25 year and 35 year terms of repayment. This may be the standard but it does not have to take anyone that long to pay off their mortgage. With a little bit of thinking ahead and a small bit of sacrifice, most people can pay off their mortgage easily in as little as ten years.
Seek the advice of a financial advisor who works for a set fee to ensure that you get the best and the most unbiased financial advice. Financial advisors from your bank or lending institution make money based on their recommendations. An independent advisor has nothing to gain from your decisions.
Opt for a closed term mortgage rather than an open one unless you will be paying it off in full during the term. An open mortgage at a fixed rate of interest carries a higher interest rate than a closed term mortgage. You can always pay off the mortgage when you are renewing, without penalty. While you are in the term you can generally pay up to 10-20% of the mortgage without a prepayment penalty.
Pay your mortgage each week or every two weeks. Both options lower the interest paid over the term of your loan resulting in the equivalent of an extra month's mortgage payment each year. This will reduce your mortgage from 25 to 21 years
When your income increases, increase your mortgage payments. This is a painless way of paying down your mortgage without feeling as if you are sacrificing your lifestyle in any way
Pay down your mortgage with your income tax refunds each year
Pay down your mortgage with windfall money which comes into your life
Maintain your payments even if you are able to renew your mortgage at a lower interest rate
Round up your mortgage payments. Over time, by rounding up, the payments will lower your over all mortgage debt.
Squeeze extra money out of your budget or extra income
Think about getting a variable rate mortgage. They have been shown to save you money over time.
While each of these ten tips are not rocket science, and each of them do not look like a huge money saver on their own time when they are consistently applied you can and will save a ton on money and pay off your mortgage years early.
For all of your Real Estate and Mortgage Needs please feel free to contact me anytime. As always the referral of your family and friends is always appreciated.