How to Pay Off Your Mortgage In Half The Time
Mortgages, they Keep You Poor or Make You Rich – You Decide
Tuesday, July 21, 2015
@6:30 pm-10:00 pm
Cash Bar @ Baka Gallery Cafe, Bloor West Village (2256 Bloor St West, above the Bell Store) – FREE admission
It‘s tangible, it’s solid, it‘s beautiful. It’s artistic, from my standpoint, and I just love real estate. Donald Trump
Mortgages, they Keep you Poor or Make you Rich – You Decide
if you are curious about…
1) How we’ve had clients save hundreds of thousands on their mortgage.
You’ll be shown how to save $100,000+ in interest on your personal mortgage of $250,000 or more.
2) How to decide IF Private Lending is for you… & How to decide what type of mortgages are best for you?
Construction? Residential 2nds? Commercial?
3) How you can, with certainty, double your retirement savings every 7 years
If you’re 45 and have $150,000 in RRSPs, you’d earn $60,000 per year from age 65 to the end of your life without having to save another penny… and be able to leave $600,000 to your heirs.
This is an educational event where you will learn to
SAVE, INVEST, RETIRE with mortgages
Join us on Tuesday, July 21, 2015 for another edition of Six Degrees Real Estate Mixer!
6:30pm Doors Open ~ Networking & Mingling at the bar
7:00pm Jonathan Weaver, Real Estate Entrepreneur and Educator
8:30pm Laure Ampilhac, Mortgage Agent & Certified Wealth Management Advisor
8:45pm Laura Johnson, Real Estate Lawyer, “All your questions answered” –
9:00pm – 10:00pm ~ Networking at the bar
7:00pm Jonathan Weaver
Jonathan has been investing in Real Estate since 1992 when he bought his first investment property.
17 years ago, Jonathan and his wife Cathie bought their first multiplex investment property, and subsequently bought two more.
In 2008, as a result of their real estate investments, the Weavers were able to take 18 months to set a world record while raising more than $400,000 in donations to Ronald McDonald Houses across North America
In the last 5 years Jonathan & Cathie have made a transition from Landlord to Lender. In addition to becoming a private lender himself, Jonathan and his business partner Richard Pyper just completed a 2 year consulting project with a Canadian Financial institution they built Canada’s only self directed RDSP and put together a Syndication program for the OSFI regulated institution.
Jonathan shares his expertise with Mortgage Agents and the public on a regular basis. He helps Mortgage Agents through a Guaranteed Profit System and helps the general public through Public Seminars.
The objective, to Educate the public that mortgage money can be used to make you wealthy vs the Training the bank provides that keeps you in debt as long as possible
Jonathan T Weaver, Principal
416 855 4776
m 416 528 8028
tf 866 244 0550
8:30pm Laure Ampilhac
After working for 15 years in corporate sales and business development in France and Canada, Laure quit a comfortable job in the 2009 recession to follow her own entrepreneurial path.
Robert Kiyosaki’s Rich Dad Training led her to a brand new career in Real Estate Investing, while creating multiple sources of active and passive income. She is a real estate entrepreneur, a landlady, a property manager, a mortgage agent and now a Certified Wealth Management Advisor. She helps home-owners refinance to take out equity and acquire more properties. She also helps investors maximize their RSP with real estate investments.
Her company is called: “Retire Early With Real Estate”.
Mortgage Agent & Certified Wealth Management Advisor
✆ (416) 358-9686 ✆ (877) 764-9492
iBrokerPower Capital Inc (The Mortgage Centre) Lic# 10538
8:45pm Laura Johnson, Real Estate Lawyer: All your questions answered
Laura practices primarily in the areas of corporate, banking and finance and real estate. Laura previously worked as legal counsel with a large international law firm, where she dealt with a broad range of corporate and commercial matters.
Laura Johnson, J.D., B.A.
Barristers & Solicitors
Phone: (800) 878-1630 ext. 107
Fax: (800) 886-2991
PS: Admission is on us. FREE event. Bring lots of business cards and good vibes!
Photo Credits: Mauricio Jimenez 647.688.5814 MAGIC VISION Photography
Voted – Top PHOTOGRAPHY STUDIO in Toronto ( Top Choice Awards – 2013) Visit us at www.magicvision.ca
How to Pay Off Your Mortgage In Half The Time
Did you know that mortgages can last for as long as you want them to, whether you are on a 30-year, 15-year, or a 10-year payment term? This is because you have control over how much money you send into your mortgage lender. By using a few of the strategies that Jonathan Weaver will be showing you, you can actually pay off your mortgage faster without going through a refinance (though that is a viable option as well).
Who wouldn’t want to pay off their mortgage faster?
The big question is “how do I do it?”
Whether to pay off your mortgage faster, is an important personal financial decision.
But before one can answer “how do I do it,” you must first ask the questions of “can I do it” and “why should I do it.”
The can-I part reveals if one has the financial ability to put more money aside for bigger and quicker payments. The why-should-I part involves whether to use the additional money available, alternatively, for investing or consumption purposes since funds borrowed under mortgage probably have a lower interest rate than say credit card debt.
Paying off a mortgage faster also has tax implications on mortgage interest deduction.
If one has the financial means; is willing to forgo any investment opportunity; is prepared to postpone any would-be nice consumption; and has weighed on any tax savings, there are ways that one can consider to pay off a mortgage faster.
Understand the Mechanism of Paying Off a Mortgage
A mortgage is paid off through a mortgage amortization process over the life of the loan in which each payment is first applied to interest accrued during the current payment period and then to reducing the outstanding principle amount.
At the end of a normal payment schedule of a 30-year mortgage, the total amount of accumulated mortgage interests would have always surpassed the initial principle of the loan, if the mortgage interest rate used is above 5.304% (calculation omitted). Even if your rate is lower you can expect the total amount you pay to be close to double your mortgaged amount.
It’s quite a sobering thing to see the total amount of the loan being double what you are borrowing!
Therefore, paying off your mortgage faster essentially saves the borrower from having to pay such a monstrous amount of interest.
Anything can reduce the outstanding principle at any given point, either by making bigger payments from time to time or more frequent payments in addition to regularly scheduled. The goal is to accrue less interest in between payments, as well as reduce the total time during which interests are accrued.
Ways to Payoff Your Mortgage Faster
1 – Increase Your Monthly Payments
Increasing the amount you pay at originally scheduled payment points whenever you can is something very easy to implement with your lender.
Your extra mortgage payment amount would be applied towards further reducing your outstanding principle and thus a less amount of money would be accruing interest.
Make sure you lender knows that the extra payment will go towards reducing the principle!
What can happen in some cases, is the extra amount you pay will go towards your next payment due rather than the principle. This doesn’t help you pay down your principle faster.
Some lenders make it nice and easy and give you a spot on the bill to put in an amount to pay principle.
One thing I’ve been doing lately is rounding up the dollar amount to the nearest hundred and paying the difference towards the principle. It’s not so much money that we miss it but it will add up over time and save us lots in interest payments.
One interesting way to pay more towards your mortgage is with credit card rewards.
One lender I know of has their own card where 1% of your spending goes to payoff your principle. It’s a creative way to use credit card rewards.
2 – Increase the Payment Schedule
Paying off your mortgage faster can save you thousands.
The normal monthly mortgage payments can be re-scheduled to be on a biweekly basis or even weekly if your financial situation allows. But how frequent the interest compounds should remain on the conventional monthly basis and not to be accelerated by your lender.
More frequent payments help lower the principle amount at their comparing time points.
3 – Change Your Loan to a Shorter Term
If you can really commit to making increased payments on a regular basis, shortening a 30-year mortgage to a 15-year loan would also save you about half of the interest and probably is the fastest way you could pay off your mortgage.
You could also pay extra in such a way that the payments you make would be what you would pay if you had a 15 year loan.
Use an online mortgage calculator to figure what your monthly mortgage would be if it were a 15 year rather than a 30 year and use that amount to pay monthly. You’ve basically just created a 15 year loan that gives you some cushion if some months you can’t make the higher payment, as you have the 30 year payment to fall back on.
4 – Refinance to a Lower Interest Rate Loan
With a lower interest rate, due to mortgage refinancing, the required monthly mortgage payments would be also lower and if you could maintain the same level of payments as before (with the higher rate), that would be equal to increasing monthly payments, and –BOOM!– pay off your mortgage faster.
We refinanced our mortgage not long ago and it’s saving us roughly $200 a month or $2,400 a year. That’s already more than a month in extra payments a year if we keep paying our original payment.
5- Last Strategy that Jonathan Weaver and Richard M. Kiernicki will be showing you on July 14 how you can save $100,000 in interests.
What looks like a low rate could add up to hundreds of thousands over the course of thirty years in interest for the bank (and money out of your pocket). Reducing the amount you owe on your principle can save you a ton of money that you could use elsewhere to build wealth.
Paying down your mortgage faster is will save you far more over the life of your mortgage than most coupon cutting can achieve.
It’s not always the right move for everyone though. You can possibly make more investing the extra money. But for many people there’s a big psychological win in knocking down the mortgage early.
Join us on July 21 to find out if you should and how!
[ Connecting Real Estate Investors and Industry Professionals in an intimate & warm atmosphere ] Social Event gathering Real Estate Professionals and Investors Bring your business cards.
ABOUT SIX DEGREES REAL ESTATE INVESTORS MIXER
HOSTED NETWORKING EVENT
Laure will be there to connect you with the partner, lender, real estate professional that you have been looking for your project, real estate transaction or investment. Come to me during the event and we will introduce you to the right person! See you there.
THE BENEFITS OF INVESTING IN THE REAL ESTATE ASSET CLASS:
#1. Cash Flow
A big advantage real estate has over other investments, is that it can produce cash flow on a monthly basis. Positive cash flow is derived from the revenue collected in the form of rent and laundry income minus expenditures required to pay for and operate the building. The cash generated by a real estate investment will always be a much larger percentage cash-on-cash return than any other investment. The reason for this is leverage.
Leverage is the ultimate power of investing, and the fact is that there is no investment where the application of this tool is more powerful than real estate. In real estate the leverage is based on the asset itself, and even the notoriously conservative banks will loan up to 75-80 percent and sometimes higher of the total asset value. Banks are comfortable lending large sums of money for the purchase of real estate because they know it is one of the safest and most profitable investments available. Also when you leverage an investment, you reap the benefits of appreciation on the total asset value, while only having a small percentage of your own money in the deal.
Real estate generally is a long term investment, and its benefits are best realized over the long term. It takes time for real estate to appreciate in value; however, while the property is appreciating the residents are paying down the mortgage. On top of this the rental income grows on a percentage annual basis.
The average compounded annual increase in real estate nationally has been 5% per year for the last 25 plus years, since 1980. Depending on the real estate cycle at any given time, the geographic location and type of property, the percentage annual increase could be substantially higher of course. Residential real estate appreciates more than the annual rate of inflation over time.
#4. Hedge Against Inflation
Many people feel that the commonsense thing to do is to take your money and put it into a savings bond or bank account that yields 2 to 3 percent per year. The main argument for this type of investing is that it is “safer” than real estate or other types of investments. The problem with this strategy is that you do not make any money, due to inflation.
Inflation is the price we pay for goods measured against a standard of ability to purchase those goods. The long term average of inflation has been nearly 3.5 percent since 1913, the year it began being tracked. That means that putting your money into a bank investment or account that yields only 2 to 3 percent, earns you no purchasing power in the future. You are actually losing wealth because inflation is higher than your returns. The gain in interest is wiped out by the rising cost of living. You are not becoming wealthier, you are becoming poorer because the cost of goods is growing faster than the value of your money.
The beauty of real estate is that it is a tangible asset-a good. Meaning it will generally rise either at the rate of inflation or much higher. Historically real estate has risen at 5 percent per year -a full 2 to 3 percent higher than inflation. And that is just appreciation. That does not take into account the cash flow generated, nor the tax advantages such as depreciation, refinance, and tax deductible mortgage interest.
Depreciation is an income tax deduction that allows a taxpayer to recover the cost of wear and tear, deterioration, or obsolescence on an annual basis. For real estate, it is a nonoperational expense that can be used to your advantage come tax time.
Another advantage of real estate over other investments is the ability to withdraw cash through a refinance of the property. This, too, is a tax shelter. When you refinance a property you are restructuring your existing mortgage debt based on the added value of the property. Refinancing also allows for investors to pull their initial investment out, while still continuing to have a vested interest in the property, creating a cash-on-cash return of infinite because the capital investment is zero!
#7. Asset Protection
There are a number of ways to legally protect a real estate investment that cannot be utilized by other investments like stocks and bonds. If a stock or bond company has a bad year, and suffers losses, the individual investor is simply out of luck. Real estate is one of the few investments that can be insured and protected from damage caused for whatever reason. By having the proper insurance coverage, you are able to claim losses for the actual value of the asset before the loss, and during the loss.
Another distinct legal advantage of real estate is that it can be placed into a corporation or family trust that allow you to protect your personal wealth by individualizing and protecting your assets in an event of a lawsuit. There are also distinct tax advantages.
#8. Physical Asset
Real estate is a physical asset, that cannot be traded by a click of a button by an online brokerage. You can physically walk the grounds of the property, and inspect the building. As such, it’s not subject to the volatility of other investments like stocks, where change can happen fast. You are not at the mercy of the company’s public relations department, waiting to hear from them. Meaning, if the company announces poor earnings for a quarter, the stock will drop suddenly with little warning. Your only option is the react, but not before you’ve lost a substantial sum.
Real estate is different. While it still has its ups and downs, for the most part real estate takes a more tortoise like approach: slow and steady wins the race. By paying attention, and knowing what to look for, we can see the trends that lead to changes in the market, well before they happen. Allowing us to formulate an investment plan on how to change operations or to sell. This in turn maximizes our return on investment or cash-on-cash return.