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Picture of a man celebrating with his arms lifted in the air representing the happy clients that saved money by breaking their mortgage

These 3 clients broke their mortgages, paid a penalty, and still saved between $9,000 and $26,000!

Picture of a man celebrating with his arms lifted in the air representing the happy clients that saved money by breaking their mortgage

While I originally posted this article in September of 2015, I think now is a good time to take another look.

Fixed mortgage rates are at an all-time low.  If you have a mortgage that is over 3.09%, then you should consider breaking it, paying the penalty and getting into today’s lower rates.

That’s the short answer… the full answer is a little more complex, but it’s really just simple math.   If the savings is greater than the cost to break, then the answer is obvious.  You should do it!   I’ll give you some real life examples of clients whose savings could be huge $$s today if they paid their mortgage and the penalty and went into a new lower rate mortgage. Check out these success stories…
Continue reading “These 3 clients broke their mortgages, paid a penalty, and still saved between $9,000 and $26,000!”

Mortgage brief…Is it worth changing your mortgage today?

Fixed rate mortgageMortgage rates have never been lower.  Should you break your current mortgage to take advantage of the lower rates?   The answer is ‘yes’ and ‘no’.

YES….if the penalty to break your mortgage is less than the potential savings.  We are seeing many opportunities today where it PAYS to break your mortgage and get into today’s lower rates.

EXAMPLE for one client..  Existing mortgage is $275,000.  The existing rate is 2.99% with 3 years to go.  The penalty to exit is $3500.  The current 3 year rate is 2.24%.  Gross savings is $5602.  Net savings is $2102.

NO… if the penalty to break your mortgage is less than the potential savings.   EXAMPLE..  Penalty is $6500 and Gross savings is $5602.  Net loss is $898.

YES… if you think interest rates are going to be much higher in the next few years, you may still want to bite the bullet, pay the penalty and lock into a longer term fixed rate mortgage.   Everyone is different and has different needs, risk tolerances, plans.  This is a personal choice.

I’ve seen examples of both situations.  You could save money by breaking your mortgage.  The best advice is to speak with an experienced Mortgage Broker. Get an UNBIASED opinion.

Your best interest is my only interest.   I reply to all questions and I welcome your comments.  Like this article?  Share with a friend.

Steve Garganis 416 224 0114 steve@mortgagenow.ca

 

These 3 clients broke their mortgages, paid a penalty, and still saved between $9,000 and $26,000!

long term contractsFixed mortgage rates are at an all-time low.  If you have a mortgage that is over 3.09%, then you should consider breaking it, paying the penalty and getting into today’s lower rates.

That’s short answer… the full answer is a little more complex but, it’s really just simple math.   If the savings is greater than the cost to break, then the answer is obvious.  You should do it!   I’ll give you some real life examples of clients that could be savings huge $$s today if they paid their mortgage and the penalty and went into a new lower rate mortgage…. check out these success stories….
Continue reading “These 3 clients broke their mortgages, paid a penalty, and still saved between $9,000 and $26,000!”

$22,500 savings by breaking mortgage and getting into today’s low rates!

break your mortgage A few weeks ago, I posted an article about one of my readers that had the potential to save $15,000 by breaking the mortgage and getting into a new 5 year fixed rate.   This was a net savings.  The actual savings was just over $20,000 less the penalty of $5,000.

This week, we had an even bigger savings.  My clients are in a 10 yr term at 3.59%, with a $710,000 balance and 8 yrs to go.   The penalty to break is $6500.   The savings is $29,000.   Result is a net savings of $22,500.   Wow!  $22,500 savings over the next 5 years!  That’s $4500/ year in savings! 

This type of savings opportunity is extremely rare.  I’ve only seen this level of savings a few times before.  We can thank the record low interest rates for that.

If you are in a mortgage with a rate that’s above 3.20%, then you could be missing an opportunity to save $$thousands.  You should at least consult with a Mortgage Broker to do the math.   Remember, I haven’t even listed the lower rate product options available, such as Variable rate, or a 3 year fixed rate.   It’s worth looking into.

Your best interest is my only interest.   I reply to all questions and I welcome your comments.  Like this article?  Share with a friend.

Steve Garganis 416 224 0114 steve@mortgagenow.ca

$15,000 savings by breaking his mortgage early and getting into today’s low rates.

break your mortgage  Look, I don’t advocate paying penalties, however, if there is an obvious savings to be had, then you have to do it.   We’ve reached a point where interest rates are so low, it’s worth a review.  Here are some recent experiences with real people…. Enjoy.

I had one of my readers contact me about breaking his mortgage…  His current mortgage with a good lender.. a Non-bank lender..  his rate is 3.59%.   He took a 10 yr term last year.  Balance was over $500k.  So with 9 yrs remaining, we reviewed his options.

This was a no brainer.  Penalty to get out was under $5,000 (lucky he was with a non-BIG SIX BANK). But the savings over the next 5 yrs would be $20,500.   His net savings is $15,000.    Would you I recommend he break the mortgage?  Absolutely! Continue reading “$15,000 savings by breaking his mortgage early and getting into today’s low rates.”

$24,000 and $19,000 in savings by refinancing their mortgages.

We’ve seen a growing trend lately… Customers calling to find out if there was any way to take advantage of today’s record low rates…..   If you are buying for the first time or are renewing a mortgage, then the answer is simple… YES..  But what if you are one of the thousands of Canadians that listened to their Bankers and the media or so-called ‘Experts’ and took at Fixed rate mortgage a few years ago.

You have a rate of 4.00% to 5.50% and you keep reading about record-low interest rates in the low 3.00% range….. what can you do?   Well, here are 2 recent examples…. These are real clients….  These are real savings…

So where was the Banker in all this?  Why didn’t the Banker call these clients to make them aware of the huge savings?   In case you didn’t know it, the Banks are a business… and they want to maximize their profit.    Don’t ever forget that.

CASE STUDY #1… 6 YEARS REMAINING AT 5.45%

We had a new client contact us with a $350k mortgage… they were with a BIG SIX bank.. their penalty to exit would be $10k… that’s a lot of money, and we don’t like anyone to pay penalties…..but we did the math and found this client a 3.29% mortgage for 5 years… the end result worked out to be a gross savings of $34,000…  After paying the penalty, they realized a savings of $24,000 over the next 5 years.   WOW!  That’s an easy decision to make.. the clients also decided to add the penalty into the mortgage…. imagine savings almost $5,000 per year!

CASE STUDY #2… 7 REMAINING AT 5.25%

Another client had a $235k mortgage… also with a BIG SIX Bank… penalty to exit was $4k…. we also found a 5 yr mortgage at 3.29% for this client… the savings worked out to $23,000…less the penalty, that worked out to $19,000 in savings over the next 5 years!…  Again, a no-brainer… Clients moved on this right away… we added the penalty into the mortgage and put almost $4,000 per year, into their pockets.

CAN YOU SAVE ON YOUR MORTGAGE?

We’re seeing more opportunity to save money by taking advantage of today’s low rates…. Don’t wait for your Bank to call.   These are just a few, recent examples.  If you’ve been thinking about how you can save on your mortgage, then take a few minutes and look into it.   Get your mortgage reviewed by an unbiased person.  Call a good Mortgage Broker.  It could be worth a closer look.   If you don’t have a broker, then feel free to contact me and I’ll do some quick math.   You might be pleasantly surprised with the results.

We’ll be sharing more of our success stories and tips on how you can save money on your mortgage.

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