Canadians are carrying record amounts of debt and most of it is mortgage debt. You can pay off your mortgage much faster to become #Mortgagefree as the best mortgage is No Mortgage.
Find the right home
It is important to ensure you’re financially ready and can actually afford the house you want to buy. Its best to hold your buying decision if you say "yes" to any of these:-
- Do we have an emergency fund for 3-6 months
- Saved at least a 10-15% of down payment
- Mortgage monthly payment is 25% or less of our monthly income
Please consider the ongoing maintenance and utilities in your decision making.
Pay Extra
Put every bit of extra cash into your mortgage
Consider putting extra money toward your mortgage. Your mortgage contract may allow you to:
- increase regular payments with extra amount
- make a lump-sum payment
Increasing the amount of regular monthly payments, even by a small amount, may help you pay off your mortgage faster. You may only be able to increase your payments by a certain amount each year.
Paying an extra $100 every month during the life of your mortgage - can save you thousands of dollars and help you pay off your mortgage much earlier.
You can make lump-sum payments on top of your regular mortgage payments to reduce the outstanding balance of your mortgage.
Please check your mortgage contract or with your lender about the prepayment options and penalties.
Make Accelerated Bi-weekly Payments
In this option, you make a payment equal to half the full monthly payment every two weeks, it helps you pay equivalent of one extra monthly payment every year which results in a significant shortening of the period to payoff.
Accelerated payments can save you money on interest charges. You’ll likely not notice a big difference in the amount of your payments, yet it may save you a lot of money in interest.
Please check your mortgage contract or with your lender about the payment options.
Refinance Your Mortgage
You can Refinance your mortgage loan at a lower interest rate or change mortgage term.
These options could allow you to pay off your mortgage early — years early even — and save you thousands of dollars in interest, as refinancing a mortgage gives you the opportunity to draft up a new loan.
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