|
|
 |
 | | Credit Cards, Credit Ratings, Loans, Mortgages, Insurance | |
| |
 | |
 .
Mortgages
Low variable mortgage rate?
Secure fixed mortgage rate?
With the 50/50 Mortgage,
you can get both - at great rates!
|
| |
The 50/50 Mortgage , splits your mortgage in half, allowing you to benefit from low rates today and protection from future rate increases. Here's how it works: |
| |
- 50% of your mortgage is fixed for five years at the current fixed rate mortgage
- The other 50% of your mortgage is in an open variable rate mortgage at our competitive prime rate. Currently banks and trust companies are offering substantial discount from these posted rates; some as low as minus 0.75% from the , current prime rate
The variable rate part of your mortgage also provides these benefits:
- the total flexibility to convert to any term at any time, at the rates available at that time.
- ability to prepay in full, or part † , with no prepayment charges.
Under this 50/50 Mortgage, some institutions provide, homeowners with 25% equity in their homes, a secured Credit Line at the prime rate. |
|
|
Money Saving Options
You can reduce the number of years it takes to pay off your mortgage and enjoy substantial savings by:
|
Increasing Your Monthly Payments
When you establish or renew your mortgage, you can increase the amount of your mortgage payments to shorten your amortization period.
You'll be surprised to see how much faster you can pay off your mortgage. and the shorter pay-off period can save you thousands of dollars in interest over the life of your mortgage!
During the term of your mortgage, you may be anticipating an increased cash flow that you could use to pay down your mortgage. Once in each 12-month period, you can choose to increase the amount of your mortgage payments by as much as 10%, without administration fees. and the increased payment amount goes directly toward reducing your principal. You continue these increased payments for the remainder of the term, unless you wish to increase them again after another 12 months.
If mortgage rates drop, you can take advantage of the opportunities to reduce your amortization period at renewal time. You can simply go on making the same regular payments after you renew at a lower interest rate. Less of your payment will go toward interest, so you'll be paying off more of the principal - a truly painless way to save money!
|
|
|
Making Double-Up ® Payments
's powerful Double-Up option gives you the flexibility to prepay any amount between $100 and the equivalent of your regular principal and interest portion of your mortgage payment on any or every payment date.
Good news: Your Double-Up payment is applied directly against the principal balance of your mortgage, which cuts down the life of your mortgage and saves interest costs.
This example shows how effectively you can reduce the time it takes to pay off your mortgage simply by doubling up one monthly payment each year.
Example: $80,000 Mortgage at 8.00%*
|
Monthly payments and 25-year amortization |
With one double payment each year |
| Mortgage repaid (years) |
25 |
20.1 |
| Total interest cost** |
$103,165 |
$80,532 |
| Interest savings** |
N/A |
$22,633 |
* Calculated, semi-annually not in advance.
** Over the life of the mortgage, assuming constant interest rate throughout amortization period.
|
|
|
Accelerating Your Payment Schedule
offers you this great choice of payment options:
- Monthly
- Semi-monthly
- Bi-weekly
- Weekly
- Accelerated bi-weekly
- Accelerated weekly
You also have the freedom to choose the day of the week or date of the month your mortgage payment is due, so you can schedule your payment to coincide with your paycheque - a convenient budgeting feature.
Increasing Your Payment Frequency
This chart illustrates how you can reduce your amortization period and save on interest costs by choosing a more frequent payment schedule.
Example: $80,000 Mortgage at 8.00% 1
| Payment |
Amount |
Amortization (Years) |
Total Interest Cost 2 |
| Monthly |
$610.58 |
25.0 |
$103,165 |
| Semi-monthly |
$305.29 |
24.9 |
$102,238 |
| Bi-weekly |
$281.81 |
24.7 |
$101,125 |
| Weekly |
$140.91 |
24.6 |
$100,697 |
Accelerated
bi-weekly 3 |
$305.29 |
19.9 |
$78,167 |
| Accelerated weekly 4 |
$152.65 |
19.9 |
$77,874 |
1 Assumes constant interest rate throughout amortization period. Compounded semi-annually, not in advance.
2 Over the life of the mortgage.
3 Monthly payment divided by 2.
4 Monthly payment divided by 4.
In this example, choosing accelerated weekly payments instead of monthly payments on an $80,000 mortgage would save you more than $25,000 in interest costs, and cut more than 5 years off the life of your mortgage.
You can change your payment frequency without cost whenever your mortgage is up for renewal or during your mortgage term.
|
|
|
Selecting a Shorter Amortization at Renewal
If you choose a shorter amortization period, you can save a lot of money and live mortgage-free sooner.
This chart compares interest costs and monthly payments on an $80,000 mortgage amortized over 15 years with those for the same mortgage amortized over 25 years. You can see how great the savings are with the shorter amortization period!
Mortgage $80,000, 25-Year amortization:
| Interest rate |
Monthly payment |
Total repaid* |
Total interest cost* |
| 5% |
$465.29 |
$139,583 |
$59,583 |
| 7% |
$560.34 |
$168,096 |
$88,096 |
| 9% |
$662.39 |
$198,709 |
$118,709 |
| 11% |
$770.03 |
$230,999 |
$150,999 |
Mortgage $80,000, 15-Year amortization:
| Interest rate |
Monthly payment |
Total repaid* |
Total interest cost* |
| 5% |
$630.50 |
$113,490 |
$33,490 |
| 7% |
$714.60 |
$128,628 |
$48,628 |
| 9% |
$803.62 |
$144,650 |
$64,650 |
| 11% |
$897.07 |
$161,469 |
$81,469 |
*Calculated assuming a constant interest rate throughout amortization period over the life of the mortgage. Compounded, semi-annually not in advance.
|
|
|
Making Principal Prepayments
A great way to save on interest costs and reduce the life of your mortgage is by making annual principal payments.
- If you choose the fixed-rate mortgage, you may prepay up to 10% of the original principal amount of your mortgage once in every 12-month period and is applied directly to the principal of your mortgage.
- With a variable rate mortgage, you can make a principal prepayment of $500 or more on any given payment date - and you can do this as often as you like!
- Plus, you can make principal prepayments of any amount you wish on your mortgage principal at renewal time.
A principal prepayment of $2,000 a year can make a substantial difference in the time it takes to pay off your mortgage. Take a look:
Example: $80,000 Mortgage at 8.00%*
|
Standard mortgage 25-year amortization |
Effect of $2,000 annual prepayment |
| Mortgage repaid (years) |
25 |
14.75 |
| Total interest cost** |
$103,165 |
$55,887 |
| Interest savings** vs. 25-year mortgage |
N/A |
$47,278 |
* Calculated, semi-annually not in advance.
** Over the life of the mortgage, assuming constant interest rate throughout amortization period.
|
|
|
|
|
 |
|
|
|
|
