History has proven that homeownership is a solid long-term investment. You build your equity stake through your regular mortgage payments and your home’s price appreciation over time. But wealth building doesn’t have to stop there. Here are 6 ways to do more throughout your mortgage years
Speed up your mortgage paydown
Change from monthly payments to weekly or biweekly, effectively increasing your number of payments, which will take years off your mortgage. Also consider putting found money like raises and tax refunds against your mortgage principal. Check your mortgage contract for the amount you can prepay each year.
Get a financial reset when needed
Too much high-interest debt over long periods of time is a definite wealth killer. It chokes your cash flow and having multiple debt payments can be stressful. If you have enough equity, you may be able to move that debt to your lower-rate mortgage, giving you one comfortable payment and thousands in interest savings
Renovate using your lowest cost funds
With historically low mortgage rates, homeowners with enough equity are using the opportunity to roll the cost of their renovation into their mortgage for one easy monthly payment, and then using their prepayment privileges to pay it off faster. It’s a win-win when you increase the comfort and enjoyment of your home, while also improving the long-term value.
Apply for incentives to help pay for energy-saving investments in your home
The federal government recently launched a new program that offers Canadians grants of up to $5,000 to pay for energy-saving home upgrades – such as insulation, furnaces, solar panels, windows, & doors – and up to $600 to help with the cost of home energy evaluations. Additionally, if you paid mortgage default insurance when financing your home, you can also get a savings boost from your mortgage insurer. If you make retrofits to improve energy efficiency, you can apply for a refund of either 15 or 25% of the default insurance premium that you paid. Applications are accepted within two years of the closing date of your mortgage.
Look at your mortgage renewal as an importannt moment of opportunity
When your lender sends out a letter suggesting you renew your mortgage at their current offer, get in touch. Everything pertaining to your mortgage can be renegotiated, giving you the opportunity to get the best possible deal for your current situation, which may be very different from when you first got your mortgage.
Know your payment penalty
When choosing between fixed-rate mortgages, be sure to compare how the early payout penalty will be calculated. If you ever need to get out of your mortgage early, having the right mortgage could save you thousands. If you take a lower rate mortgage with a high prepayment penalty, the benefit of that lower rate could mean nothing if you overpay on the penalty to get out of your mortgage.
If you have any further questions, reach out to Brendan directly!
Phone: 647.678.8214
Email: propermortgages@gmail.com
Visit: https://www.propermortgages.com/