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Mortgage Broker News | 23 Jul 2014, 11:01 AM Agree 0
Strangley enough, brokers are echoing the sentiments of a big bank and warning clients not to follow a recent trend.
  • Angela Wong-Liao - Invis Inc | 23 Jul 2014, 02:58 PM Agree 0
    I fully agree with Fred Testa and Panjwani, this is the time to pay down your mortgage as much as you can afford. Interest rates will increase in future and reducing your mortgage balance can absorb some payment shock. I also agree with Panjwani, if you have higher interest rates debts, ie: credit cards and lines of credits, it is wise to pay down these debts first prior to prepaying your mortgage.
  • Daniel McKay | 23 Jul 2014, 04:09 PM Agree 0
    I firmly disagree with paying down mortgage debt, when such low fixed rates are available. Mortgagors are much better off using their excess income to pay down higher interest debt and saving/investing giving current market conditions. Do yourself and your clients a favor by referring them to a financial planner who does not have in house financing. The financial planner should have no problems generating savings returns much higher than what paying down the mortgage will generate, and it return, would probably be more than happy to send some referrals back your way. This has the benefit of building client savings that could be used to make mortgage payments in case they lose their ability to earn income. When rates do go up in the future, they then have the option to pay down the mortgage with the investments as well.
  • Arbitrage | 23 Jul 2014, 04:11 PM Agree 0
    Disagree...if you have disciplined clients now is the time to invest those extra dollars in TFSA's and RRSP's. Roll the tax return from the RRSP investment into the mortgage if you must but a halfway savvy person should be able to get 7-9% on a tax adjusted basis. Even if you already had TFSA and RRSP contributions maxxed I still think there is a strong argument for increasing your mortgage size right now for the purposes of investment. Of course, as mentioned above, paying down your 19% credit card takes priority over everything! :-)
  • Tom Hedderich | 25 Jul 2014, 09:35 AM Agree 0
    Disagree! Refinance into a low fixed rate mortgage if you have not done so already. Establish education funds for you children. Fully fund your own retirement plan. After that apply all excess funds to high rate debt like credit cards or HELOCS. If you have variable rate debt that will be with you for 5 years or more now is the time to convert that debt to fixed rates.
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