Consolidating debt into mortgage scotiabank

Or you can keep your monthly payments the same, and shave years off your amortization period so you’ll own your home outright sooner. For instance, if you had a five-year fixed mortgage at 5.0% you might be eyeing the current rate of about 3.39%.That’s a difference of less than two percentage points, but it actually means reducing your rate by more than a quarter, which could translate into reducing each monthly payment by 30%.“Any time you break a mortgage, the penalty may be too high to make it worth it,” says Kim Gibbons, a mortgage broker with Mortgage Intelligence in Toronto.“But you can usually recapture that penalty pretty quickly if you have a variable-rate mortgage.” In this case, calculating that penalty is easy.“As soon as I realized that, I paid the

Or you can keep your monthly payments the same, and shave years off your amortization period so you’ll own your home outright sooner. For instance, if you had a five-year fixed mortgage at 5.0% you might be eyeing the current rate of about 3.39%.That’s a difference of less than two percentage points, but it actually means reducing your rate by more than a quarter, which could translate into reducing each monthly payment by 30%.“Any time you break a mortgage, the penalty may be too high to make it worth it,” says Kim Gibbons, a mortgage broker with Mortgage Intelligence in Toronto.“But you can usually recapture that penalty pretty quickly if you have a variable-rate mortgage.” In this case, calculating that penalty is easy.“As soon as I realized that, I paid the $1,800 penalty, and kept the amortization period the same at 25 years,” he says.“I’m now saving $150 a month on my payments.” If you’ve been watching rates lately, you may be wondering if you could break your mortgage to save a pile of cash too.Your lender will get less in interest payments out of you than you initially agreed to, so there will usually be a penalty.

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Or you can keep your monthly payments the same, and shave years off your amortization period so you’ll own your home outright sooner. For instance, if you had a five-year fixed mortgage at 5.0% you might be eyeing the current rate of about 3.39%.

That’s a difference of less than two percentage points, but it actually means reducing your rate by more than a quarter, which could translate into reducing each monthly payment by 30%.

“Any time you break a mortgage, the penalty may be too high to make it worth it,” says Kim Gibbons, a mortgage broker with Mortgage Intelligence in Toronto.

“But you can usually recapture that penalty pretty quickly if you have a variable-rate mortgage.” In this case, calculating that penalty is easy.

“As soon as I realized that, I paid the $1,800 penalty, and kept the amortization period the same at 25 years,” he says.

“I’m now saving $150 a month on my payments.” If you’ve been watching rates lately, you may be wondering if you could break your mortgage to save a pile of cash too.

Your lender will get less in interest payments out of you than you initially agreed to, so there will usually be a penalty.

“When people buy a home they’re not thinking of breaking their mortgage,” says Vince Gaetano, principal mortgage broker with Monster in Toronto.

,800 penalty, and kept the amortization period the same at 25 years,” he says.“I’m now saving 0 a month on my payments.” If you’ve been watching rates lately, you may be wondering if you could break your mortgage to save a pile of cash too.Your lender will get less in interest payments out of you than you initially agreed to, so there will usually be a penalty.

” it’s more like: “How much is breaking the mortgage going to cost me? There are penalties for breaking both fixed- and variable-rate mortgages, but the penalties for breaking a variable mortgage are usually much lower.Tjernell thought that all variable-rate mortgages were the same, but that wasn’t the case.His original mortgage offered a rate of prime plus 40 basis points (there are 100 basis points in one percentage point).Keep in mind that lowering the cost of your mortgage can be done in two different ways.You can keep the total length of the mortgage—called the amortization period—the same and reduce each monthly payment. The rule used to be that it’s worth breaking your mortgage when you can get a new rate that’s at least two percentage points lower than your current one. Because the rates are so low now, it’s worth switching for a much smaller drop.

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There was a lot of paperwork—Tjernell’s wife is a freelance graphic designer, so they had to prove that she had regular income.

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